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51  ^ 


in 


v&r*ry 


TRUST  INDENTURE 


ASSOCIATED  SIMMONS  HARDWARE 
COMPANIES 

TO 

CONTINENTAL  AND  COMMERCIAL  TRUST 
AND  SAVINGS  BANK, 

TRUSTEE, 

AND 

FIRST  NATIONAL  BANK  IN  ST.  LOUIS, 

CO-TRUSTEE 


DATED  MAY  1,  1920 


r 

Securing  an  Issue  of  $10,000,000.  of  Five-Year  7% 
Secured  Gold  Notes  of  Associated  Simmons 
Hardware  Companies 


TABLE  OF  CONTENTS* 

OF 

TRUST  INDENTURE 

ASSOCIATED  SIMMONS  HARDWARE  COMPANIES 

TO 

CONTINENTAL  AND  COMMERCIAL  TRUST  AND  SAVINGS  BANK, 

TRUSTEE 

AND 

FIRST  NATIONAL  BANK  IN  ST.  LOUIS,  CO-TRUSTEE, 

DATED  MAY  1,  1920. 


Page 

Parties  (Promisors,  Trustee  and  Co-Trustee) 1 

Recitals  : 

Trust  Agreement  creating  Associated  Simmons  Hardware  Companies. . 1 

Powers  of  Promisors  to  borrow  money  and  issue  notes 1 

Authorization  of  notes  and  indenture  by  Promisors 2 

Form  of  note 3 

Form  of  interest  coupon 7 

Form  of  Trustee’s  certificate , 8 

Performance  of  requirements  of  law,  etc 8 

Pledging  clauses  : 

Pledge  of  stocks,  etc.,  to  secure  notes 8 

Stocks  of  Controlled  Companies  (List  I) 9 

(1)  Simmons  Hardware  Company  (Missouri) 9 

(2)  Simmons  Hardware  Company  (Pennsylvania) 9 

(3)  Simmons  Hardware  Company  (Minnesota) 10 

(4)  The  Morton-Simmons  Hardware  Company  (Kansas) 10 

(5)  The  Simmons  Hardware  Company  (Ohio) 10 

(6)  Dymond-Simmons  Hardware  Company  (Iowa) ’ 10 

(7)  Simmons  Hardware  Company  (New  York) 11 

(8)  Simmons  Hardware  Company  (Massachusetts).... 11 

(9)  Simmons  Warehouse  Company  (New  Jersey) 11 

(10)  The  Walden  Knife  Company  (New  York) 11 

(11)  Frye  Phipps  Co.  (Massachusetts) 12 

(12)  Simmons  Import  & Export  Corporation  (New  York) 12 

(13)  Universal  Paint  Company  (Missouri) 12 


indenture  as  executed,  but  are  added  hereto  for  conveniences. 


ii 

(14)  Stanwood  Motor  Car  Company  (Missouri) 12 

(15)  Hardware  Distributors  Company  (New  Jersey)... 13 

(16)  Stock  now  owned  or  hereafter  acquired  of  other  Controlled 

Companies  as  herein  defined 13 

(17)  Stocks,  notes,  etc.,  of  Controlled  Companies  except  notes  evi- 

dencing current  borrowings  from  the  Promisors 13 

Stocks  other  than  Controlled  Companies  carried  as  investments  hy  the 
Promisors  (List  II) 14 

(1)  Scruggs,  Vandervoort,  Barney  Dry  Goods  Company  (Mis- 

souri)   14 

(2)  Grant  Leather  Corporation  (Virginia) 14 

(3)  Roanoke  Spoke  and  Handle  Company,  Inc.  (Virginia) 14 

(4)  Pacific  Development  Company  (New  York) 15 

(5)  Other  stocks  15 

Property  hereafter  pledged  hereunder  (List  III) 15 

Issues,  profits  and  income  of  pledged  securities  (List  IV) 16 

Habendum 16 

Assignment  and  pledge  in  trust 16 

Trust  estate 16 

ARTICLE  I. 

ISSUE  AND  AUTHENTICATION  OF  NOTES. 

Sec.  1.  Designation  of  form,  amount,  denominations,  maturity,  rate  of 

interest  and  places  of  payment  of  notes 17 

Payment  without  deduction  for  taxes  except  Federal  income  taxes 
in  excess  of  two  per  cent 18 

Sec.  2.  Execution  of  notes 18 

Execution  of  interest  coupons 19 

Sec.  3.  Authentication  of  notes  by  Trustee 19 

Sec.  4.  Delivery  of  $7,500,000  of  authenticated  notes  by  Trustee 20 

Sec.  5.  Provisions  for  authentication  and  delivery  of  $2,500,000  of  addi- 
tional notes  20 

Sec.  6.  Application  of  proceeds  of  notes 22 

Sec.  7.  Temporary  notes  22 

Sec.  8.  Replacement  of  mutilated,  destroyed  or  lost  notes 23 

Sec.  9.  Registration  of  notes 24 


iii 

ARTICLE  II. 

COVEN-ANTS  OF  THE  PROMISORS. 

Sec.  1.  (a)  To  pay  principal  and  interest 25 

(b)  Tax  refund  under  Pennsylvania  laws 25 

(c)  To  pay  taxes,  etc.,  on  trust  estate  and  all  property,  etc.,  of 

Promisors  and  Controlled  Companies 2G 

(d)  Not  to  create  any  prior  lien  on  trust  estate 27 

(e)  Not  to  extend  payment  of  interest  coupons,  etc 27 

(f)  To  keep  proper  records  of  accounts,  etc 27 

(g)  As  to  ownership  of  trust  estate  and  of  right  to  pledge  same 

hereunder  28 

(h)  To  pledge  additional  stocks,  etc.,  hereafter  acquired,  etc....  28 

(i)  For  further  assurances 28 

(j)  To  insure  property 28 

(k)  To  maintain  corporate  existence  of  Controlled  Companies...  30 

(l)  To  maintain  plants,  etc 30 

(m)  As  to  borrowing  of  money  by  Controlled  Companies 30 

Not  to  mortgage  property 30 

Exception 30 

(n)  As  to  maintenance  of  quick  assets 31 

Definition  of  quick  assets 31 

Definition  of  net  debt 32 

Definition  of  Controlled  Companies 32 

(o)  Right  of  Controlled  Companies  to  borrow  from  Promisors..  32 

(p)  To-  maintain  the  trust  creating  Associated  Simmons  Hard- 

ware Companies  32 

(q)  Waiver  of  redemption,  etc.,  laws 32 

(r)  To  pay  attorneys’  fees.. 33 

(s)  Permission  for  mortgage  of  $500,000  of  Grant  Leather  Cor- 

poration   '33 

Sec.  2.  Covenants  of  indenture  for  benefit  of  parties  hereto  and  note 

holders 33 

ARTICLE  III. 

CONCERNING  THE  PLEDGED  SECURITIES. 

Sec.  1.  Delivery  of  pledged  securities  to  Trustee  and  holding  of  same 

by  Trustee 33 

Sec.  2.  Powers  of  Trustee  with  respect  to  pledged  shares  of  stock  as  to 

maintaining  corporate  existence,  qualifying  directors,  etc 34 


iv 

Sec.  3.  Voting  of  shares  of  stock  pledged  hereunder 35 

Sec.  4.  Application  of  dividends  upon  pledged  shares  of  stock 36 

Sec.  5.  (a)  Merger  or  consolidation  of  Controlled  Companies 37 

(b)  Amendments  or  alterations  of  charters  or  by-laws  of  Con- 

trolled Companies,  and  increase  or  decrease  of  stock  of 
such  companies  37 

(c)  Releases  of  pledged  securities 38 

(1)  In  case  of  sale  or  exchange  of  pledged  securities 38 

(2)  In  case  of  sale  of  all  the  property  of  a corporation 38 

(3)  In  case  of  merger  or  consolidation 39 

Consent  to  releases 39 

Substitution  of  other  securities,  etc.,  for  released  securities 39 

Sec.  G.  Prohibition  of  sale,  exchange  or  release  of  stock  or  all  prop- 
erty of  Controlled  Companies,  except  as  herein  provided 39 

Sec.  7.  Release  of  pledged  securities  for  pash  or  other  securities 40 

Sec.  8.  Partial  releases  of  pledged  securities  on  payment  of  part  of 

notes  42 

Sec.  9.  Liability  of  Trustee  as  to  releases 42 

Sec.  10.  General  powers  of  Trustees  with  respect  to  pledged  securities 

and  protection  thereof  42 

ARTICLE  IV. 

REDEMPTION  OF  NOTES. 

Sec.  1.  Right  of  redemption  of  notes,  premiums  therefor,  and  notice  of 

redemption  43 

Sec.  2.  Cancellation  and  surrender  of  redeemed  or  paid  notes 44 

Sec.  3.  Sufficiency  of  notice  of  redemption 44 

Sec.  4.  Release  of  trust  estate  upon  deposit  of  funds  with  Trustee  for 

payment  or  redemption  of  notes 45 

Sec.  5.  Return  of  funds  not  used  for  payment  of  notes  within  three 

years 45 

ARTICLE  V. 

INDIVIDUAL  IMMUNITY  OF  PROMISORS,  EXECUTIVE  COM- 
MITTEE AND  HOLDERS  OF  PARTICIPATION  CERTIFICATES. 

Release  of  individual  liability  of  Promisors,  Executive  Committee 
and  holders  of  participation  certificates 45 


V 


ARTICLE  VI. 

RIGHTS  OF  NOTE  HOLDERS. 

Sec.  1.  Rights  of  action  vested  in  Trustees 40 

Sec.  2.  Proof  of  execution  of  instruments  by  note  holders 47 

Sec.  3.  Powers  of  note  holders  as  to  releases,  waivers  and  modification 

of  trust  indenture 4S 

ARTICLE  VII. 

POWERS  OF  THE  PROMISORS. 

Sec.  1.  Authorization  of  one  of  the  Promisors  to  act  for  all  of  the  Prom- 
isors, and  appointment  of  agents  of  the  Promisors 49 

Sec.  2.  Revocation  of  appointments  of  agents,  etc.,  and  substitution....  49 

Sec.  3.  Effect  of  death  of  a Promisor 50 

Sec.  4.  Definition  of  Promisors 50 

Sec.  5.  Successor  trustees  under  trust  agreement  creating  Associated 

Simmons  Hardware  Companies  50 

Sec  6.  Sufficiency  of  notice  to  Promisors 50 

Sec.  7.  Liability  of  Trustee  and  Co-Trustee 51 

ARTICLE  VIII. 

RIGHTS  AND  REMEDIES  IN  EVENT  OF  DEFAULT. 

Sec.  1.  Events  of  default 51 

(a)  Nonpayment  of  interest  continued  for  30  days 51 

(b)  Nonpayment  of  principal 51 

(c)  Default  in  observance  of  other  covenants  continued  for 

30  days  after  notice  to  Promisors  from  Trustee 51 

(d)  Insolvency,  bankruptcy,  liquidation  or  general  assign- 

ment of  any  of  Controlled  Companies 51 

(e)  Appointment  of  receiver  of  any  of  Controlled  Companies, 

or  of  its  properties 51 

(f)  Sequestration  of  property  of  Controlled  Companies  or 

Promisors  not  released  within  60  days,  or  judgment 
against  Promisors,  or  Controlled  Companies  unsatis- 
fied for  60  days ' 51 

Declaration  of  maturity  of  outstanding  notes 52 


vi 

Sec.  2.  Voting  of  pledged  stock  and  collection  of  dividends  in  event  of 

default 52 

Sec.  3.  Sale  of  trust  estate  in  event  of  default 53 

Place  and  notice  of  sale 53 

Adjournment  of  sale 54 

Delivery  of  securities  to  purchaser  at  sale 54 

Effect  of  sale 54 

Proceeding  by  suit  and  foreclosure  in  lieu  of  exercise  of  power 

of  sale  55 

Sec.  4.  Application  of  proceeds  of  sale  of  trust  estate 55 

Sec.  5.  Application  of  notes  in  payment  of  purchase  price  by  purchaser . . 56 

Trustees  or  note  holders  may  become  purchasers  at  sale 56 

Sec.  6.  Promisors  to  pay  amount  due  in  event  of  default 56 

Trustee  may  recover  judgment  as  trustee  of  an  express  trust....  57 

Application  of  monies  collected  by  Trustee  in  event  of  suit 58 

Trustee  may  act  without  Co-Trustee 58 

Sec.  7.  Waiver  of  stay,  valuation  and  redemption  laws  by  Promisors...  58 
Waiver  of  jurisdiction  of  courts  by  Promisors 59 

Sec.  8.  Delay,  etc.,  of  Trustees  not  a waiver  of  defaults 59 

Sec.  9.  Remedies  not  exclusive,  but  cumulative. 59 

Sec.  10.  Restoration  of  rights  of  Trustees  in  event  of  discontinuance  of 

proceedings  or  adverse  ruling  therein 60 

ARTICLE  IX. 

THE  TRUSTEES. 

Sec.  1.  Conditions  of  acceptance  of  trusts  by  Trustees * 60 

Not  responsible : 

(a)  For  recitals  in  notes  and  indenture 60 

(b)  For  execution,  validity  or  sufficiency  of  notes  and  in- 

denture   60 

(c)  For  recordation,  etc 60 

(d)  For  application  of  proceeds  of  notes 61 

(e)  For  acts  of  agents,  etc 61 

(f)  For  instituting  or  defending  suits,  or  for  notice  of  de- 

faults, etc 61 

(g)  For  acting  upon  documents,  etc.  or  in  accordance  with 

opinion  of  counsel 61 

(h)  For  errors,  etc 61 

(i)  Trustees  may  acquire  notes,  etc 62 

(j)  Trustees  may  treat  monies  as  general  deposit 62 

(k)  Compensation  of  Trustees  and  payment  of  expenses  of  Trus- 

tees   62 


vii 

Sec.  2.  Resignation  of  Trustees 62 

Sec.  3.  Appointment  of  successor  Trustees ' 63 

Sec.  4.  Effect  of  merger  or  consolidation  of  Trustees 64 

Sec.  5.  Rights,  powers  and  duties  of  successor  Trustees 64 

Sec.  6.  Towers  and  duties  of  Co-Trustee 65 

Sec.  7.  Definition  of  Trustee  and  Co-Trustee 65 

Sec.  8.  Trustees  represent  holders  of  notes 65 

ARTICLE  X. 

INTERPRETATION  AND  SUNDRY  PROVISIONS. 

Sec.  1.  Effect  of  illegality  of  any  provision  of  notes  or  indenture 66 

Sec.  2.  Indenture  binding  on  successors  of  Promisors 66 

Sec.  3.  Execution  of  indenture  in  counterparts 66 

TestIx\ionium 66 

Signatures  and  seals  of  parties  to  indenture 67 

Acknowledgments  of  parties 68-72 


0 


Digitized  by  the  Internet  Archive 
in  2017  with  funding  from 

University  of  Illinois  Urbana-Champaign  Alternates 


https://archive.org/details/trustindentureasOOasso 


UtytB  itttottture,  made  this  first  day  of  May,  1920,  by 
and  between  WALLACE  D.  SIMMONS,  LEVI  L.  RUE 
and  EDWARD  H.  SIMMONS,  as  the  present  acting  and 
qualified  Trustees  under  a certain  Agreement  and 
Declaration  of  Trust  made  as  of  the  26th  day  of 
April,  1920,  creating  a trust  therein  called  ASSOCIATED 
SIMMONS  HARDWARE  COMPANIES,  for  themselves 
as  such  trustees  and  their  successors  in  said  trust  (here- 
inafter called  the  * 1 Promisor s”),  parties  of  the  first  part, 
and  CONTINENTAL  AND  COMMERCIAL  TRUST 
AND  SAVINGS  BANK,  a corporation  organized  and 
existing  under  the  laws  of  the  State  of  Illinois  (hereinaf- 
ter called  the  “Trustee”),  and  FIRST  NATIONAL 
BANK  IN  ST.  LOUIS,  a corporation  organized  and  ex- 
isting under  the  National  Banking  Laws  and  authorized 
to  execute  and  accept  trusts  (hereinafter  referred  to  as 
Co-Trustee),  parties  of  the  second  part,  both  of  which 
parties  of  the  second  part  are  together  hereinafter  re- 
ferred to  as  “Trustees,”  Witnesseth: 

Whereas,  an  executed  original  copy  of  the  aforesaid  Agree- 
ment and  Declaration  of  Trust  creating  the  trust  therein 
called  Associated  Simmons  Hardware  Companies  is,  con- 
temporaneously with  the  execution  of  this  indenture,  filed 
with  the  Trustee,  and  under  the  provisions  of  said  Agree- 
ment and  Declaration  of  Trust  the  following  powers,  among 
others,  are  conferred  upon  the  trustees  acting  under  said 
Agreement  and  Declaration  of  Trust,  and  being  the  Promi- 
sors above  designated,  parties  of  the  first  part  to  this  inden- 
ture, to  wit: 

“Article  Three. 

Section  1.  (h)  To  borrow  money  from  time  to  time 

and  to  issue  notes,  bonds  or  other  evidences  of  indebted- 
ness, either  secured  or  unsecured,  and  for  Ihe  purpose  of 


Parties.* 


“Promisors.” 


“Trustee.” 


“Co-Trustee.’ 


“Trustees.” 


Trust  agree- 
ment creating- 
Associated 
Simmons 
Hardware 
Companies. 


Powers  of 
Promisors  to 
borrow  money 
and  issue  notes. 


♦Marginal  notes  were  not  on  original  executed  indentures. 


2 


Trust  estate. 


Authority  of 
Promisors. 


Authorization 
of  notes  and 
indenture  by 
Promisors. 


securing  the  same  to  execute  and  deliver  any  mortgage, 
pledge,  collateral  trust  indenture  or  other  lien  or  incum- 
brance upon  the  whole  or  any  part  of  the  trust  estate, 
all  upon  such  terms  and  conditions  and  for  such  pur- 
poses and  in  such  manner  as  they  may  determine ; and  to 
sell  said  notes,  bonds  or  other  evidences  of  indebtedness 
either  at  par  or  for  such  amount,  either  more  or  less  than 
par,  as  they  may  determine. 

and 

Whereas,  there  is  included  in  the  trust  estate  mentioned 
and  referred  to  in  said  Agreement  and  Declaration  of  Trust 
the  shares  of  stock  and  certificates  therefor  hereinafter  men- 
tioned and  pledged  and  assigned  to  the  Trustees  under  this 
indenture;  and 

Whereas,  under  said  Agreement  and  Declaration  of  Trust 
the  trustees  therein  (the  Promisors  herein  named,  parties 
of  the  first  part  to  this  indenture)  have  power  and  are  au- 
thorized to  enter  into  and  execute  an  indenture  or  agreement 
evidencing  the  terms  and  conditions  upon  which  any  of  said 
trust  estate  may  be  pledged  for  the  purpose  of  securing  any 
notes  of  the  Promisors;  and 

Whereas,  in  pursuance  of  The  provisions  of  said  Agree- 
ment and  Declaration  of  Trust,  and  under  the  powers  therein 
granted  and  conferred,  the  Promisors  have  resolved  and 
determined  to  execute  and  issue  their  notes  (hereinafter  re- 
ferred to  as  notes)  for  the  aggregate  principal  amount  of 
Ten  Million  Dollars  ($10,000,000),  to  be  dated  May  1,  1920, 
and  to  mature  and  become  payable  on  May  1,  1925,  and  to 
bear  interest  at  the  rate  of  seven  per  cent  (7%)  per  annum 
from  the  day  of'  the  date  thereof,  the  first  interest  to  be 
payable  on  JuJy  1,  1920,  and  subsequent  installments  of  in- 
terest to  be  payable  on  January  1 and  July  1 of  each  year 
thereafter  until  the  maturity  of  said  notes  (except 
that  an  installment  of  said  interest  shall  also  be 
payable  on  May  1,  1925),  which  notes  are  to  be 

known  as  ‘ ‘ Associated  Simmons  Hardware  Companies 


3 


Five-Year  Seven  Per  Cent  Secured  Gold  Notes,’ ’ and 
both  principal  and  interest  of  which  notes  are  to  be 
payable  at  the  office  of  Continental  and  Commercial  Trust  and 
Savings  Bank,  in  the  City  of  Chicago,  Illinois,  or,  at  the  op- 
tion of  the  holder,  at  the  office  of  the  First  National  Bank 
in  the  Borough  of  Manhattan,  in  the  City  of  New  York,  New 
York,  or  at  the  office  of  the  National  Shawmut  Bank,  in  the 
City  of  Boston,  Massachusetts,  or  at  the  office  of  the  First 
National  Bank  in  St.  Louis,  in  the  City  of  St.  Louis, 
Missouri,  in  gold  coin  of  the  United  States  of  America  of  or 
equal  to  the  standard  of  weight  and  fineness  existing  on 
May  1,  1920,  and  which  notes  and  the  interest  coupons  to 
be  attached  thereto  evidencing  said  interest  payments  are 
to  be  substantially  in  the  forms  hereinafter  set  forth;  and 
said  Promisors,  in  order  to  secure  the  payment  of  said 
notes,  have  resolved  and  determined  to  execute  a collateral 
trust  indenture  in  the  form  of  this  indenture,  pledging  and 
assigning  to  the  Trustees  the  shares  of  stock  and  certificates 
therefor  hereinafter  mentioned  and  described,  upon  the  trusts 
hereinafter  set  forth;  and 

Whereas,  the  notes  to  be  issued  under  and  secured  by  this 
indenture,  the  coupons  for  interest  to  be  annexed  to  said 
notes,  and  the  certificate  of  the  Trustee  to  be  endorsed  on  said 
notes  are  to  be  in  substantially  the  following  forms  (except 
as  to  denominations  and  distinguishing  numbers) : 

{Form  of  Note.) 

No $1,000.00 

UNITED  STATES  OF  AMERICA, 
Associated  Simmons  Hardware  Companies, 
Five-Year  Seven  Per  Cent  Secured  Gold  Note. 

For  value  received  the  undersigned  (hereinafter  called 
Promisors),  not  individually,  but  as  the  acting  and 
qualified  trustees  under  a certain  Agreement  and  Dec- 
laration of  Trust  dated  as  of  April  26,  1920,  creat- 


4 


in g a trust  therein  called  Associated  Simmons  Hardware 
Companies,  acknowledge  themselves  indebted  and  here- 
by promise  to  pay  to  the  bearer  hereof,  or  if  this  note 
be  registered,  then  to  the  registered  holder  thereof,  the 
sum  of  One  Thousand  Dollars  ($1,000),  on  the  first  day 
of  May,  1925,  and  to  pay  interest  thereon  from  the  date 
hereof  until  the  payment  of  the  principal  hereof,  at 
the  rate  of  seven  per  cent  (7%)  per  annum,  on  the  first 
day  of  July  and  the  first  day  of  January  of  each  year 
after  the  date  hereof  (except  that  there  shall  also  be  an 
interest  payment  on  May  1,  1925),  the  interest  hereon 
until  maturity  hereof  being  payable  on  presentation 
and  surrender  of  the  interest  coupons  hereto  annexed  as 
they  severally  become  due. 

Both  principal  and  interest  of  this  note  are  payable 
at  the  office  of  Continental  and  Commercial  Trust  and 
Savings  Bank  in  the  City  of  Chicago,  Illinois,  or  at  the 
option  of  the  holder,  at  the  office  of  First  National  Bank 
in  the  Borougdi  of  Manhattan,  in  the  City  of  New  York, 
New  York,  or  at  the  office  of  National  Shawmut  Bank  in 
the  City  of  Boston,  Massachusetts,  or  at  the  office  of  First 
National  Bank  in  St.  Louis,  in  the  City  of  St.  Louis,  Mis- 
souri, in  gold  coin  of  the  United  States  of  America  of  or 
equal  to  the  standard  of  weight  and  fineness  existing  on 
May  1,  1920,  without  deduction  for  any  tax  or  taxes  (ex- 
cept federal  income  taxes  in  excess  of  2%  and  inheritance 
and  succession  taxes),  which  the  Promisors  (or  their  suc- 
cessors) or  the  Trustees  under  the  trust  inden- 
ture hereinafter  mentioned  or  said  banks  or  either 
of  them  may  be  required  to  pay  thereon  or  to 
deduct  or  retain  therefrom  under  any  present  or  future 
constitution,  law  or  lawful  regulation  of  the  United 
States  or  of  any  state,  territory,  county,  municipality 
or  other  lawful  taxing  authority  therein.  The  Promisors 
further  agree,  as  provided  in  said  trust  indenture,  to 
reimburse  to  the  holder  hereof  any  and  all  taxes  (ex- 
cept any  succession  or  inheritance  taxes)  which  may  be 
imposed  upon  this  note  or  the  holder  hereof  by  or  for 
the  benefit  of  the  Commonwealth  of  Pennsylvania  under 
the  laws  of  said  commonwealth,  but  not  in  excess  of  four 
mills  per  annum  on  each  dollar  of  the  principal  amount 
of  this  note. 

This  note  is  one  of  an  authorized  issue  of  notes  of  the 
Promisors  limited  to  the  aggregate  principal  amount  of 
Ten  Million  Dollars  ($10,000,000)  at  any  one  time  out- 


5 


standing,  known  as  Associated  Simmons  Hardware* Com- 
panies Five-Year  Seven  Per  Cent  Secured  Gold  Notes, 
all  of  which  are  of  like  date,  tenor  and  effect  (except 
as  to  denominations  and  distinguishing  numbers)  and 
all  issued  and  to  be  issued  under  and  equally  secured  by 
a trust  indenture  dated  May  1,  1920,  between  the  Prom- 
isors and  Continental  and  Commercial  Trust  and  Savings 
Bank,  Chicago,  Illinois  and  First  National  Bank  in  St. 
Louis,  as  Trustees,  to  which  indenture  reference  is  hereby 
made  for  a specification  of  the  property  therein  pledged 
and  assigned  and  agreed  to  be  pledged  and  assigned  as 
security  for  the  payment  of  said  notes,  and  the  nature 
and  extent  of  such  security,  and  the  rights  of  the  holders 
of  said  notes,  and  the  terms,  and  conditions  upon  which 
said  notes  are  issued  and  secured. 

This  note  may  be  called  and  redeemed  by  the  Prom- 
isors (or  their  successors)  on  any  interest  date  prior 
to  its  fixed  maturity  upon  the  notice  and  in  the  manner 
and  upon  the  terms  prescribed  in  said  trust  indenture, 
and  upon  payment  of  the  principal  thereof  and  accrued 
interest  to  the  date  of  redemption,  and  upon  payment  of 
the  following  premiums  upon  the  principal  when  called 
for  redemption  and  payment  in  the  following  years,  viz. : 
two  and  one-half  per  cent  (2J%)  in  1920;  two  per  cent 
(2%)  in  1921;  one  and  one-half  per  cent  (1-J%)  in  1922; 
one  per  cent  (1%)  in  1923;  one-half  per  cent  ( ) in 
1924,  and  no  premium  in  1925. 

In  event  of  a default  as  specified  in  said  trust  inden- 
ture, the  principal  of  this  note  and  of  the  other  notes 
of  said  issue  may  be  declared  to  be  due  before  the  date 
of  maturity  herein  fixed,  in  the  manner  and  with  the  effect 
provided  in  said  trust  indenture;  and  in  such  event  the 
Promisors  agree  hereby  promptlv  to  pay  the  same  in 
accordance  with  the  terms  of  said  trust  indenture. 

This  note  shall  pass  by  delivery  unless  registered  in 
the  owner’s  name  upon  registration  books  kept  for  that 
purpose  by  Continental  and  Commercial  Trust  and 
Savings  Bank,  Trustee  under  said  trust  indenture, 
at  its  office  in  the  City  of  Chicago,  Illinois,  and  such 
registry  noted  hereon  by  said  Trustee.  After  such 
registry  no  transfer  hereof  shall  be  valid  unless  made 
on  such  registration  books  by  the  registered  owner  in 
person  or  by  attorney  duly  authorized  in  writing  and  such 
registration  similarly  noted  hereon,  but  it  may  be  dis- 
charged from  registry  by  transfer  to  bearer  made  on 


6 


such  books  and  noted  hereon  and  thereafter  shall  be 
transferable  by  delivery,  but  may  again  from  time  to 
time  be  registered  or  transferred  to  bearer  as  before. 
While  registered,  only  the  registered  holder  hereof  shall 
be  entitled  to  receive  the  principal  hereof,  but  such  regis- 
try shall  not  affect  the  negotiability  of  the  interest  cou- 
pons which  shall  always  continue  to  be  transferable  by 
delivery  notwithstanding  any  registration. 

This  note  is  executed  by  the  Promisors,  not  individual- 
ly, but  as  trustees  under  the  aforesaid  Agreement  and 
Declaration  of  Trust  dated  as  of  April  26,  1920, 
to  which  reference  is  hereby  made  | and  any  and  all  per- 
sonal liability  of  any  present  or  future  trustee  under 
said  Agreement  and  Declaration  of  Trust  is  expressly 
and  strictly  limited  to  the  application  and  distribution 
of  the  property  from  time  to  time  constituting  the  trust 
estate  thereunder,  in  accordance  with  the  provisions  of 
said  Agreement  and  Declaration  of  Trust  and  the  trust 
indenture  above  mentioned;  and  any  and  all  liability  of 
any  present  or  future  trustee  (except  as  aforesaid)  or 
member  of  the  executive  committee  in  said  Agreement 
and  Declaration  of  Trust  named  or  provided  for,  or 
shareholder  or  other  beneficiary  thereunder,  is,  by  the 
acceptance  and  as  a consideration  for  the  issue  and  exe- 
cution hereof,  expressly  waived  by  the  holder  hereof. 

The  principal  and  interest  in  respect  to  this  note  shall 
be  payable  without  regard  to  any  equities  between  the 
Promisors  and  the  original  or  any  intermediate  holder 
hereof ; the  bearer,  or  if  registered,  the  registered  holder 
hereof,  may  sue  hereon  in  his  own  name;  and  this  note 
shall  have  all  other  attributes  of  a negotiable  instru- 
ment, and  every  holder  hereof  by  accepting  this  note 
assents  to  the  foregoing  provisions. 

This  note  shall  not  be  obligatory  for  any  purpose  un- 
less and  until  it  shall  have  been  authenticated  by  the 
execution  by  said  Continental  and  Commercial  Trust  and 
Savings  Bank  as  Trustee  under  said  trust  indenture, 
of  the  certificate  endorsed  hereon. 

Ix  witness  whereof  at  the  City  of  Boston,  in  the  State 
of  Massachusetts,  the  undersigned  as  trustees  under 
said  Agreement  and  Declaration  of  Trust  have  caused 
their  names  to  be  hereunto  affixed  by  one  of  them  acting 
on  behalf  of  all  of  them,  and  the  interest  coupons  hereto 
annexed  to  be  executed  by  the  facsimile  signature  of  one 
of  them  acting  on  behalf  of  all  of  them  (all  pursuant  to 


7 


authority  given  by  all  of  them),  this  first  day  of  May, 
1920. 

Wallace  D.  Simmons, 

Levi  L.  Rue, 

Edward  H.  Simmons, 

As  Acting  and  Qualified  Trustees  Under  the 
Agreement  and  Declaration  of  Trust 
Dated  as  of  April  26,  1920,  creating  the 
Trust  Therein  Called  Associated  Simmons 
Hardware  Companies,  and  Not  Individu- 
ally (hereinbefore  designated  as  Prom- 
isors), 

. By. , 

One  of  Said  Trustees  Acting  Pursuant  to 
Authority  Given  by  All  of  Said  Trustees . 

(Form  of  Interest  Coupon.) 

No $35.00 

On  the  first  day  of  , 19 (unless  the 

note  herein  mentioned  shall  have  been  duly  called  for 
previous  redemption),  upon  presentation  and  surrender 
hereof  at  the  office  of  the  Continental  and  Commercial 
Trust  and  Savings  Bank,  in  the  city  of  Chicago,  Illinois, 
or,  at  the  option  of  the  bearer,  at  the  office  of  First 
National  Bank,  in  the  Borough  of  Manhattan,  in  the  city 
of  New  York,  New  York,  or  at  the  office  of  National  Shaw- 
mut  Bank  in  the  City  of  Boston,  Massachusetts,  or  at  the 
office  of  First  National  Bank  in  St.  Louis,  in  the  city  of 
St.  Louis,  Missouri,  the  undersigned  will  pay  to  the  bearer  . 
Thirty-five  Dollars  ($35)  in  gold  coin  of  the  United  States 
of  America,  of  the  standard  of  weight  and  fineness  exist- 
ing on  May  1,  1920,  without  deduction  for  taxes  (except 
federal  income  taxes  in  excess  of  2%,  and  inheritance 
and  succession  taxes),  being  the  interest  then  due  on  the 
Five-Year  Seven  Per  Cent  Secured  Gold  Note  of  the 
Associated  Simmons  Hardware  Companies,  Numbered 


Wallace  D.  Simmons, 

Levi  L.  Rue,  and* 

Edward  H.  Simmons, 

As  Trustees  Under  an  Agreement  and 
Declaration  of  Trust  Dated  April  26, 
1920,  Creating  a Trust  Therein  Called 
Associated  Simmons  Hardivare  Com- 
panies, 

By. , 

One  of  said  Trustees,  pursuant  to  author- 
ity given  by  all  of  said  Trustees . 


Form  of 
coupon. 


8 


Form  of 
Trustee’* 
certificate. 


Performance  of 
requirements 
of  law,  etc. 


Pledge  of 
stocks,  etc.,  to 
secure  notes. 


( Form  of  Trustee’s  Certificate.) 


This  is  to  certify  that  this  is  one  of  the  notes  described 
in  the  within  mentioned  trust  indenture. 

Continental  and  Commercial  Trust 
and  Savings  Bank, 

Trustee , 

By- - - - 

• Assistant  Secretary. 


And  whereas,  all  acts  and  things  prescribed  by  the  afore- 
said Agreement  and  Declaration  of  Trust  dated  as  of  April 
26,  1920,  and  required  by  law  or  otherwise,  to  make 
said  Five-Year  Seven  Per  Cent  Secured  Gold  Notes,  when  ex- 
ecuted by  the  Promisors  and  authenticated  by  the  Trustee, 
valid,  legal  and  binding  obligations,  and  to  make  this  inden- 
ture a valid,  legal  and  binding  agreement  for  the  security 
thereof,  and  to  make  the  deposit,  pledge  and  assignment  of 
the  shares  of  stock  and  certificates  therefor  under  this  inden- 
ture lawful  and  valid,  have  duly  and  lawfully  been  done  and 
performed ; 

Now,  THEREFORE,  THIS  INDENTURE  WITNESSETH  : That,  in  Or- 
der to  secure  the  payment  of  the  principal  and  interest  of  all 
of  said  notes  at  any  time  issued  and  outstanding  under  this 
indenture,  according  to  their  tenor,  purport  and  effect,  and 
to  secure  the  performance  and  observance  of  all  the  covenants 
and  conditions  therein  and  herein  contained,  and  to  declare 
the  terms  and  conditions  upon  which  said  notes  are  issued, 
received  and  held,  and  for  and  in  consideration  pf  the  prem- 
ises, and  of  the  acceptance  of  said  notes  by  the  holders  there- 
of, and  of  the  sum  of  One  Hundred  Dollars  ($100)  lawful 
money  of  the  United  States  to  the  Promisors  duly  paid  by 
the  Trustees,  at  or  before  the  ensealing  and  delivery  of  this 
indenture,  receipt  whereof  is  hereby  acknowledged,  the 
Promisors  have  executed  and  delivered  this  indenture,  and 
have  sold,  pledged,  assigned,  transferred  and  set  over,  unto 
said  Continental  and  Commercial  Trust  and  Savings  Bank, 


9 


and  First  National  Bank  in  St.  Louis,  as  Trustees  liereunder, 
their  successors  and  assigns  in  the  trust  hereby  created,  the 
following  described  property,  namely: 


List  I. 

STOCKS  OF  CONTROLLED  COMPANIES. 

All  and  singular  the  following  shares  of  stock  of  the  fol- 
lowing several  corporations  (herein  termed  and  hereinafter 
mentioned  as  “ Controlled  Companies’’),  the  certificates  for 
which,  duly  endorsed  in  blank  for  transfer  have  been  or  are 
to  be  delivered  to  the  Trustee: 

Item  1:  Simmons  Hardware  Company  ( Missouri ). 

(a)  14,985  ^shares,  of  the  aggregate  par  value  of 

$1,498,500,  of  the  first  preferred  stock  of  the  Simmons 

Hardware  Company,  a corporation  organized  and  exist- 
ing under  the  laws  of  the  State  of  Missouri,  out  of  the 
total  authorized  and  outstanding  stock  of  said  Company 
of  15,000  shares,  being  all  of  said  authorized  and  out- 
standing shares  of  stock  except  only  the  shares  held 
by  the  directors  of  said  Company. 

(b)  15,000  shares,  of  the  aggregate  par  value  of 

$1,500,000,  of  the  second  preferred  stock  of  said  Simmons 
Hardware  Company,  being  the  total  number  of  shares  of 
said  stock  authorized  and  outstanding. 

(c)  15,000  shares,  of  the  aggregate  par  value  of 

$1,500,000,  of  the  common  stock  of  said  Simmons  Hard- 
ware Company,  being  the  total  number  of  shares  of  said 
stock  authorized  and  outstanding. 

Item  2:  Simmons  Hardware  Company  (Pennsylvania). 

9,982  shares,  of  the  aggregate  par  value  of  $998,- 
200,  of  the  capital  stock  of  Simmons  Hardware  Company, 
(of  Philadelphia),  a corporation  organized  and  exist- 
ing under  the  laws  of  the  State  of  Pennsylvania,  out  of 
the  total  authorized  and  outstanding  stock  of  said  Com- 
pany of  10,000  shares,  being  all  of  said  authorized  and 
outstanding  shares  of  stock,  except  only  the  shares  held 
by  the  directors  of  said  Company. 


Stocks  of 
Controlled 
Companies. 


Simmons 

Hardware 

Company 

(Missouri) 


Simmons 

Hardware 

Company 

(Pennsyl- 

vania). 


10 


Simmons 

Hardware 

Company 

(Minnesota). 


The  Morton- 

Simmons 

Hardware 

Company 

(Kansas). 


The  Simmons 
Hardware 
Company 
(Ohio). 


Dymond- 

Simmons 

Hardware 

Company 

(Iowa). 


Item  3:  Simmons  Hardware  Company  ( Minnesota ). 

• 3,993  shares,  of  the  aggregate  par  value  of  $399,300, 
of  the  capital  stock  of  Simmons  Hardware  Company,  (of 
Minneapolis),  a corporation  organized  and  existing  un- 
der the  laws  of  the  State  of  Minnesota,  out  of  the  total 
authorized  and  outstanding  stock  of  said  Company,  of 
4,000  shares,  being  all  of  said  authorized  and  outstand- 
ing shares  of  stock,  except  only  the  shares  held  by  the 
directors  of  said  Company. 

Item  4:  The  Morton-Simmons  Hardivare  Company 

(Kansas). 

(a)  991  shares,  of  the  aggregate  par  value  of  $99,100, 
of  the  preferred  stock  of  The  Morton-Simmons  Hard- 
ware Company  (of  Wichita,  Kansas),  a corporation  or- 
ganized and  existing  under  the  laws  of  the  State  of 
Kansas,  out  of  the  total  authorized  and  outstanding  pre- 
ferred stock  of  said  Company,  of  1,000  shares,  being  all 
of  said  authorized  and  outstanding  shares  of  preferred 
stock,  except  only  the  shares  held  by  the  directors  of  said 
Company. 

(b)  1,500  shares,  of  the  aggregate  par  value  of  $150,- 
000,  of  the  common  stock  of  said  The  Morton-Simmons 
Hardware  Company,  being  all  of  the  authorized  and  out- 
standing common  stock  of  said  Company. 

Item  5:  The  Simmons  Hardivare  Company  (Ohio). 

4,991  shares,  of  the  aggregate  par  value  of  $499,100, 
of  the  capital  stock  of  The  Simmons  Hardware  Com- 
pany, (of  Toledo,  Ohio),  a corporation  organized  and 
existing  under  the  laws  of  the  State  of  Ohio,  out  of  the 
total  authorized  and  outstanding  stock  of  said  Company, 
of  5,000  shares,  being  all  of  said  outstanding  shares  of 
stock,  except  only  the  shares  held  by  the  directors  of  said 
Company. 

Item  6:  Dymond-Simmons  Hardivare  Company  (Iowa). 

2,993  shares,  of  the  aggregate  par  value  of  $299,300, 
of  the  common  stock  of  Dymond-Simmons  Hardware 
Company,  (of  Sioux  City,  Iowa),  a corporation  organized 
and  existing  under  the  laws  of  the  State  of  Iowa,  out  of 
the  total  authorized  and  outstanding  common  stock  of 
said  Company,  of  3,000  shares,  being  all  of  said  outstand- 


11 


ing  sliar.es  of  stock  except  only  the  shares  held  by  the  di- 
rectors of  said  Company. 

Item  7:  Simmons  Hardivare  Company  {New  York). 

94  shares,  of  the  aggregate  par  value  of  |9,400,  of  the 
capital  stock  of  Simmons  Hardware  Company,  (of  New 
York  City),  a corporation  organized  and  existing  under 
the  laws  of  the  State  of  New  York,  out  of  the  total  au- 
thorized and  outstanding  stock  of  said  Company,  of  100 
shares,  being  all  of  said  authorized  and  outstanding 
shares  of  stock,  except  only  the  shares  held  by  the  di- 
rectors of  said  Company. 

Item  8:  Simmons  Hardivare  Company  ( Massachusetts ). 

95  shares,  of  the  aggregate  par  value  of  $9,500,  of  the 
capital  stock  of  Simmons  Hardware  Company,  (of  Bos- 
ton, Massachusetts),  a corporation  organized  and  exist- 
ing under  the  laws  of  the  State  of  Massachusetts,  out 
of  the  total  authorized  and  outstanding  stock  of  said 
Company  of  100  shares,  being  all  of  said  authorized  and 
outstanding  shares  of  stock  except  only  the  shares  held 
by  the  directors  of  said  Company. 

r 

Item  9:  Simmons  Warehouse  Company  {New  Jersey). 

2,495  shares,  of  the  aggregate  par  value  of  $249,500, 
of  the  capital  stock  of  Simmons  Warehouse  Company, 
(of  Jersey  City,  New  Jersey),  a corporation  organized 
and  existing  under  the  laws  of  the  State  of  New  Jersey, 
out  of  the  total  authorized,  and  outstanding  stock  of  said 
Company,  of  2,500  shares,  being  all  of  said  authorized 
and  outstanding  shares  of  stock  except  only  the  shares 
held  by  the  directors  of  said  Company. 

Item  10:  The  Walden  Knife  Company  {New  York). 

1,395  shares,  of  the  aggregate  par  value  of  $13,950,  of 
the  capital  stock  of  The  Walden  Knife  Company  (of 
Walden,  New  York),  a corporation  organized  and  exist- 
ing under  the  laws  of  the  State  of  New  York,  out  of  the 
total  authorized  and  outstanding  stock  of  said  Company, 
of  2,000  shares,  of  the  par  value  of  $10  each. 


Simmons 
Hardware 
Company 
(New  York). 


Simmons 

Hardware 

Company 

(Massachu- 

setts). 


Simmons 
Hardware 
Company 
(New  Jersey). 


The  Walden 
Knife  Company 
(New  York). 


12 


Frye  Phipps 
Co.  (Massachu- 
setts). 


Simmons  Im- 
port & Export 
Corporation 
(New  York). 


Universal  Paint 

Company 

(Missouri). 


Stanwood 
Motor  Car 
Company 
(Missouri). 


Item  11:  Frye  Phipps  Co.  ( Massachusetts ). 

1,495  shares,  of  the  aggregate  par  value  of  $149,500, 
of  the  capital  stock  of  the  Frye  Phipps  Co.  (of  Boston), 
a corporation  organized  and  existing  under  the  laws  of 
the  State  of  Massachusetts,  out  of  the  total  author- 
ized and  outstanding  stock  of  said  Company,  of  1,500 
shares,  being  all  of  said  authorized  and  outstanding 
shares  of  stock  of  said  Company,  except  only  the  shares 
held  by  the  directors  of  said  Company. 

Item  12:  Simmons  Import  & Export  Corporation  (Neiv 

York). 

93  shares,  of  the  aggregate  par  value  of  $9,300,  of  the 
capital  stock  of  Simmons  Import  & Export  Corporation, 
(of  New  York  City),  a corporation  organized  and  existing 
under  the  laws  of  the  State  of  New  York,  out  of  the  total 
authorized  and  outstanding  stock  of  said  corporation, 
of  100  shares,  being  all  of  said  authorized  and  outstand- 
ing shares  of  stock,  except  only  the  shares  held  by  the  di- 
rectors of  said  Corporation. 

Item.  13:  Universal  Paint  Company  (Missouri). 

995  shares,  of  the  aggregate  par  value  of  $99,500,  of  . 
the  capital  stock  of  Universal  Paint  Company,  (of  St. 
Louis),  a corporation  organized  and  existing  under  the 
laws  of  the  State  of  Missouri,  out  of  the  total  authorized 
and  outstanding  stock  of  said  Company,  of  1,000  shares, 
being  all  of  said  authorized  and  outstanding  shares  of 
stock,  except  only  the  shares  held  by  the  directors  of  said 
Company. 

Item  14:  Stanwood  Motor  Car  Company  (Missouri). 

995  shares,  of  the  aggregate  par  value  of  $99,500,  of 
the  capital  stock  of  Stanwood  Motor  Car  Company,  (of 
St.  Louis),  a corporation  organized  and  existing  under 
the  laws  of  the  State  of  Missouri,  out  of  the  total  author- 
ized and  outstanding  stock  of  said  Company,  of  1,000 
shares,  being  all  of  said . authorized  and  outstanding 
shares  of  stock,  except  only  the  shares  held  by  the  di- 
rectors of  said  Company. 


13 


Item  15:  Hardware  Distributers  Company  ( Neiv  Jer- 
sey). 

15  shares  of  the  aggregate  par  value  of  $1,500,  of  the 
capital  stock  of  Hardware  Distributers  Company,  a cor- 
poration organized  and  existing  under  the  laws  of  the 
State  of  New  Jersey,  out  of  the  total  authorized  and  out- 
standing stock  of  said  Company,  of  20  shares,  being  all 
of  said  authorized  and  outstanding  shares  of  stock,  ex- 
cept the  shares  held  by  the  directors  of  said  Company. 

Item  16: 

Also  all  shares  of  stock  of  any  other  corporations  (not 
included  in  List  II  as  hereinafter  specified)  which  may 
be  now  owned  or  hereafter  acquired  or  organized,  a ma- 
jority of  the  outstanding  stock  of  which  is  owned  or 
acquired  by  the  Promisors  (or  their  successors)  under 
the  said  Agreement  and  Declaration  of  Trust  dated  as 
of  April  26,  1920,  and  which  companies  shall  be  deemed 
Controlled  Companies  for  the  purposes  of  this  indenture, 
it  being  understood  that  there  may  be  excluded  there- 
from sufficient  shares  to  qualify  directors  of  such  com- 
panies; and  the  Promisors  hereby  undertake  and  agree 
to  deliver  such  shares  of  stock  to  the  Trustee  hereunder, 
as  and  when  said  shares  of  stock  are  acquired  and  which 
shares  of  stock  when  so  received  by  the  Trustee  shall  be 
held  as  pledged  under  and  subject  to  the  terms  and  condi- 
tions of  this  indenture. 

Item  17 : 

Also  any  and  all  shares  of  stock  and  all  notes,  bonds, 
or  obligations  of  any  of  the  aforesaid  Controlled  Com- 
panies (but  not  including  any  notes  or  obligations  of 
Controlled  Companies  to  the  Promisors  evidencing  cur- 
rent borrowings  from  the  Promisors  maturing  not  more 
than  six  months  after  the  date  thereof),  or  of  any  other 
voluntary  associations  or  corporations  which  the  Prom- 
isors as  trustees  under  the  said  Agreement  and  Declara- 
tion of  Trust  dated  as  of  April  26,  1920,  or  any  of  the 
Controlled  Companies,  or  the  Trustees  hereunder,  may 
at  any  time  receive  or  may  become  entitled  to  receive. 


Hardware 
Distributers* 
Company 
(New  Jersey). 


Stock  now 
owned  or  here- 
after acquired 
of  other  con- 
trolled com- 
panies as  here- 
in defined. 


Stocks,  notes, 
etc.,  of 
Controlled 
Companies, 
except  notes 
evidencing- 
current  borrow- 
ing's from  the 
Promisors. 


Stocks  carried 
as  investments. 


Scrug'g's,  Van- 
dervoort,  Bar- 
ney Dry  Goods 
Company 
(Missouri). 


Grant  Leather 

Corporation 

(Virginia). 


Roanoke  Spoke 
and  Handle 
Company 
(Virginia). 


14 


List  II. 

STOCKS  OF  OTHER  THAN  CONTROLLED  COMPANIES,  CARRIED  AS 
INVESTMENTS  BY  THE  PROMISORS. 

Item  1:  Scruggs,  Vandervoort,  Barney  Dry  Goods  Com - 

pany  (Missouri). 

(a)  1,000  shares  of  the  aggregate  par  value  of  $100,- 
000  of  the  second  preferred  stock  of  Scruggs,  Vander- 
voort, Barney  Dry  Goods  Company  (of  St.  Louis),  a 
corporation  organized  and  existing  under  the  laws  of 
the  State  of  Missouri,  out  of  the  total  outstanding  second 
preferred  stock  of  said  Company  consisting  of  7,493f 
shares. 

(b)  3,000  shares  of  the  aggregate  par  value  of  $300,- 
000  of  the  common  stock  of  said  Scruggs,  Vandervoort, 
Barney  Dry  Goods  Company,  out  of  the  total  outstand- 
ing common  stock  of  said  Company  consisting  of  25,000 
shares. 

Item  2:  Grant  Leather  Corporation  (Virginia). 

(a)  10,920  shares  of  the  aggregate  par  value  of  $1,092,- 
000  of  the  preferred  stock  of  Grant  Leather  Corpora- 
tion, (of  Kingsport,  Tennessee),  a corporation  organized 
and  existing  under  the  laws  of  Virginia,  out  of  the  total 
authorized  and  outstanding  preferred  stock  of  said  Com- 
pany, consisting  of  20,000  shares. 

(b)  10,926  shares  of  the  aggregate  par  value  of  $1,092,- 
600  of  the  common  stock  of  said  Grant  Leather  Corpora- 
tion, out  of  the  total  authorized  and  outstanding  common 
stock  of  said  corporation,  consisting  of  20,000  shares. 

(c)  Any  other  shares  of  the  stock  of  said  Grant 
Leather  Corporation  to  which  the  Promisors  (or  their 
successors)  may  be  now  or  hereafter  entitled. 

Item  3 : Roanoke  Spoke  and  Handle  Company,  Inc.  (Vir- 
ginia). 

(a)  150  shares  of  the  aggregate  par  value  of  $15,000 

of  the  preferred  capital  stock  of  Roanoke  Spoke  and 
Handle  Company,  Inc.,  (of  Roanoke,  Virginia),  a cor- 
poration organized  and  existing  under  the  laws  of  Vir- 


15 


ginia,  being  the  total  outstanding  preferred  stock  of  said 
Company. 

(b)  248  shares  of  the  aggregate  par  value  of  $24,800, 

of  the  common  stock  of  said  Roanoke  Spoke  and  Handle 
Company,  out  of  the  total  authorized  and  outstanding 
common  stock  of  said  Company,  of  387  shares. 

Item  4:  Pacific  Development  Company  ( New  York). 

834  shares  of  the  aggregate  par  value  of  $41,700  of  the 
Pacific  Development  Company,  (of  New  York  City),  a 
corporation  organized  and  existing  under  the  laws  of  the 
State  of  New  York,  out  of  the  total  authorized  and  out- 
standing stock  of  said  Company,  of  100,000  shares  of 
the  par  value  of  $50  each. 

Item  5: 

Any  other  shares  of  stock  or  certificate  therefor,  in 
any  corporation  or  association  now  owned  or  here- 
after acquired  by  the  Promisors  (or  their  successors)  and 
not  hereinbefore  described  in  aforesaid  List  I or  this 
List  II. 


List  III. 

PROPERTY  HEREAFTER  PLEDGED  HEREUNDER. 

Also  all  property  of  every  name  and  nature  from  time 
to  time  hereafter  by  delivery  or  by  writing  of  any  kind, 
for  the  purposes  hereof,  pledged,  assigned  or  trans- 
ferred by  the  Promisors,  or  with  their  written  consent, 
by  anyone  in  their  behalf,  to  the  Trustees  which  hereby 
are  authorized  to  receive  any  property  at  any  and  all 
times,  as  and  for  additional  security,  and  also,  when 
and  as  hereinafter  provided,  as  substituted  security,  for 
the  payment,  as  to  both  principal  and  interest,  of  the 
notes  issued  or  to  be  issued  hereunder,  and  to  hold  and 
apply  any  and  all  such  property  according  to  the  terms 
hereof. 


Facifio  Devel- 
opment Com- 
pany (New 
York). 


Other  stocks. 


Property  here- 
after pledg-ecl 
hereunder. 


16 


Income  from 

pledged 

securities. 


Habendum 
“Trust  Estate.” 


List  IV. 

ISSUES,  PROFITS  AND  INCOME  OF  PLEDGED  SECURITIES. 

Also  any  and  all  issues,  profits  and  income  of  the 
stock,  certificates  therefor  and  securities  hereinbefore 
described  and  assigned,  and  any  and  all  right,  title  and 
interest  which  may  hereafter  be  acquired  by  the  Prom- 
isors, as  trustees  under  said  Agreement  and  Declaration 
of  Trust,  dated  April  26,  1920,  in  or  to  any  of  said 
shares  of  stock,  certificates  therefor,  or  securities. 

(The  capital  stock  of  the  Frye  Phipps  Co.  and  of  the 
Grant  Leather  Corporation,  as  above  listed  and  described 
may  be  delivered  to  the  Trustee  hereunder  subsequent 
to  the  date  of  the  execution  of  this  indenture,  and  the 
Promisors  covenant  and  agree  so  to  deliver  the  same 
within  thirty  days  from  the  date  of  this  indenture;  and 
the  Trustees  may  execute  this  indenture,  and  the  Trus- 
tee may  authenticate  and  deliver  the  notes  issuable  here- 
under upon  the  execution  of  this  indenture  by  the 
Promisors  and  prior  to  the  delivery  of  said  stock  to  the 
Trustee  hereunder.) 

To  have  and  to  hold  all  and  singular  the  above-described 
shares  of  stock,  certificates  therefor  and  other  securities 
(sometimes  hereinafter  referred  to  as  the  trust  estate)  here- 
by assigned  and  pledged  or  intended  to  be  assigned  and 
pledged  or  hereafter  to  be  assigned  and  pledged  unto  the 
said  Continental  and  Commercial  Trust  and  Savings 
Bank  as  Trustee  and  said  First  National  Bank  in  St.  Louis, 
as  Co-Trustee,  and  their  successor  or  successors  in  trust 
and  its  and  their  assigns  forever,  said  trust  estate,  however, 
to  be  held  and  administered  by  said  Continental  and  . Commer- 
cial Trust  and  Savings  Bank,  as  such  Trustee ; but 

in  trust  nevertheless  for  the  equal  and  proportion- 
ate use,  benefit  and  security  of  each  and  every  pres- 
ent and  future  holder  of  any  of  the  notes  or  the 

coupons  thereto  appertaining  issued  under  and  pursu- 

ant to  this  indenture  and  without  preference  of  any 
of  said  notes  over  any  of  the  others  by  reason  of  priority 


17 


in  the  time  of  issue  or  negotiation  thereof  or  otherwise  how- 
soever, and  for  the  enforcement  of  the  payment  of 
said  notes  and  coupons  when  due  according  to  their  tenor, 
purport  and  effect  and  the  performance  of  and  compliance 
with  the  covenants  and  conditions  of  said  notes  and  of  this 
indenture,  subject,  however,  to  the  provisions  and  stipula- 
tions in  the  said  notes  contained  and  to  the  terms,  condi- 
tions, provisions  and  agreements  hereinafter  expressed  and 
declared,  and  for  the  uses,  purposes  and  trusts  hereinafter  set 
forth. 

ARTICLE  I. 

ISSUE  AND  AUTHENTICATION  OE  NOTES. 

Section  1.  The  notes  issued  under  and  secured  by  this 
indenture  shall  be  substantially  in  the  form  hereinbefore  set 
forth  and  shall  be  limited  to  the  aggregate  principal  amount 
of  Ten  Million  Dollars  ($10,000,000)  at  any  one  time  out- 
standing. Said  notes  shall  consist  of  coupon  notes  for  the 
principal  amounts  of  Five  Hundred  Dollars  ($500)  and  One 
Thousand  Dollars  ($1,000)  each,  and  shall  be  dated  May  1, 
1920,  and  mature  and  become  payable  on  May  1,  1925.  Notes 
for  the  principal  amount  of  Five  Hundred  Dollars  ($500) 
each  shall  be  numbered  from  D 1 upwards,  and  notes  for 
the  principal  amount  of  One  Thousand  Dollars  ($1,000)  each 
shall  be  numbered  from  M 1 upwards.  The  notes  issued 
hereunder  shall  bear  interest  at  the  rate  of  seven  per  cent 
(7%)  per  annum  from  the  date  thereof,  payable  on  July  1st 
and  January  1st  of  each  year  after  the  date  thereof,  except 
that  a payment  of  interest  shall  also  be  made  on  May  1,  1925. 
Said  interest  shall  be  evidenced  by  interest  coupons  to  be 
attached  to  said  notes,  the  first  coupon  to  become  due  and 
payable  on  July  1,  1920,  and  to  represent  the  interest  on 
said  notes  from  May  1,  1920  to  July  1,  1920,  and  the  last 
interest  coupon  to  become  due  and  payable  on  May  1,  1925, 


Form  of  notes. 


Amount. 


Denominations. 


Maturity. 


Interest. 


18 


Places  of 
payment. 


Fayment  with- 
out deduction 
for  taxes, 
except  federal 
income  taxes  in 
excess  of  2 per 
cent,  etc. 


Execution  of 
notes. 


and  to  represent  the  interest  due  and  payable  on  said  notes 
from  January  1,  1925  to  May  1,  1925.  Both  principal  and 
interest  of  said  notes  shall  be  payable  at  the  office  of  the 
Continental  and  Commercial  Trust  and  Savings  Bank  in 
the  City  of  Chicago,  Illinois,  or  at  the  option  of  the  holder 
at  the  office  of  the  First  National  Bank  in  the  Borough  of 
Manhattan,  in  the  City  of  New  York,  State  of  New  York,  or 
at  the  office  of  National  Shawmut  Bank,  in  the  City  of  Boston, 
Massachusetts,  or  at  the  office  of  the  First  National  Bank  in 
St.  Louis,  in  the  City  of  St.  Louis,  Missouri,  in  gold  coin  of  the 
United  States  of  America  of  or  equal  to  the  stand- 
ard‘of  weight  and  fineness  existing  on  May  1,  1920,  without 
deduction  for  any  tax  or  taxes  (except  federal  income  taxes 
in  excess  of  2%  and  inheritance  and  succession  taxes),  which 
the  Promisors  (or  their  successors),  or  the  Trustees  or  the 
banks  at  which  said  notes  are  payable  may  be  required  to  pay 
thereon  or  to  deduct  or  retain  therefrom  under  any  present 
or  future  constitution,  law  or  lawful  regulation  of  the  United 
States  or  of  any  state,  territory,  county,  municipality  or  other 
lawful  taxing  authority  therein. 

Section  2.  The  notes  to  be  issued  hereunder  shall  from 
time  to  time  be  signed  by  the  Promisors  as  trustees  under 
said  Agreement  and  Declaration  of  Trust  dated  as  of  April 
26,  1920,  and  not  individually,  or  such  notes  bear- 
ing the  name  of  each  of  the . Promisors  as  such  trustees 
shall  be  signed  by  any  one  of  the  said  trustees  on  behalf 
of  all  the  said  trustees  under  said  Agreement  and  Decla- 
ration of  Trust,  and  said  notes  so  executed  shall  be  binding 
upon  and  be  the  notes  of  all  of  the  Promisors,  and  shall  there- 
upon be  delivered  to  the  Trustee  for  authentication,  and  shall 
be  authenticated  and  delivered  by  the  Trustee'  as  hereinaf- 
ter provided.  The  death  of  the  Promisors  or  any  of  them, 
or  any  successor  to  tliem  shall  not  operate  to  revoke 
said  authorization  to  sign  said  notes.  In  event  any  of  the 
trustees  in  whose  names  any  of  the  notes  shall  have  been 


19 


signed  shall  cease  to  be  trustees  or  trustee  under  said  Agree- 
ment and  Declaration  of  Trust  and  thereby  shall  cease  to  be’ 
Promisors  or  Promisor  hereunder,  or  in  event  any 
one  of  the  Promisors  who  on  behalf  of  all  of  the 
Promisors  shall  have  signed  any  of  said  notes  shall  .cease  to 
be  such  a trustee  under  said  Agreement,  or  Declara- 
tion of  Trust,  before  the  notes  so  signed  shall  have  been 
actually  executed  and  authenticated  and  delivered  by  the 
Trustee  hereunder,  such  notes  may  nevertheless  be  executed, 
and  when  so  executed,  may  be  issued,  authenticated  and  de- 
livered as  though  the  said  three  persons  in  whose  names  such 
notes  have  been  signed,  or  the  Promisor  who  has  signed  such 
notes  on  behalf  of  all  the  Promisors  had  not  ceased  to  be  such 
trustees  and  Promisors  or  trustee  and  Promisor  as  the  case 
may  be.  And  any  note  may  be  signed  on  behalf  of  the  Prom- 
isors by  a person  who  at  the  actual  time  of  such  signature 
shall  be  one  of  the  trustees  under  said  Agreement  and  Dec- 
laration of  Trust,  although  at  the  time  and  date  of  such  note 
such  person  shall  not  have  been  one  of  such  trustees.  The 
coupons  for  interest  on  said  notes  shall  be  authenticated  by 
the  facsimile  signature  of  any  one  of  the  Promisors  or  any 
present  or  future  agent  of  the  Promisors,  and  for  that  pur- 
pose the  Promisors  may  adopt  and  use  a facsimile  signature 
of  any  Promisor  or  any  present  or  future  agent  notwith- 
standing the  fact  that  he  may  have  ceased  to  be  such  agent 
at  the  time  when  such  notes  shall  be  actually  issued,  au- 
thenticated and  delivered. 

Section  3.  Only  such  notes  as  shall  bear  thereon  endorsed 
a certificate  substantially  in  the  form  hereinbefore  recited 
executed  by  the  Trustee,  by  its  Secretary  or  Assistant  Secre- 
tary or  other  duly  authorized  agent  shall  be  secured  by  this 
indenture  or  entitled  to  any  lien,  right  or  benefit  hereunder. 
No  such  note  or  any  coupon  thereunto  appertaining  shall  be 
valid  for  any  purpose  unless  and  until  such  certificate  shall 
have  been  duly  endorsed  on  such  note.  Such  certificate  of 


Execution  of 

interest 

coupons. 


Authentication 
of  notes  by 
Trustee. 


20 


Delivery  of 
$7,500,000  of 
authenticated 
notes  hy 
Trustee. 


Frovisions  for 

authentication 

and  delivery  of 

$2,500,000 

additional 

notes. 


the  Trustee  upon  any  note  signed  by  or  on  behalf  of  the 
Promisors  shall  be  conclusive  and  the  only  evidence  that 
the  note  so  authenticated  was  duly  issued  hereunder  and  is 
entitled  to  benefit  of  the  trusts  and  security  of  this  inden- 
ture. Before  authenticating  and  delivering  any  such  notes 
all  interest  coupons  thereto  appertaining  and  then  matured 
shall  be  cut  off,  canceled  and  delivered  to  the  Promisors  by 
the  Trustee. 

Section  4.  On  the  execution  of  this  indenture  there  shall 
forthwith  be  executed  by  or  on  behalf  of  the  Promisors  and 
delivered  to  the  Trustee  and  thereupon  the  Trustee  with- 
out any  further  act  of  the  Promisors  shall  authenticate  and 
deliver  Seven  Million  Five  Hundred  Thousand  Dollars 
($7,500,000)  principal  amount  of  said  notes  with  all  unma- 
tured coupons  thereto  appertaining  to  or  upon  the  written 
order  of  any  one  or  more  of  the  Promisors. 

Section  5.  The  remaining  Two  Million,  Five  Hundred 
Thousand  Dollars  ($2,500,000)  principal  amount  of  the  notes, 
or  any  part  thereof,  hereby  secured,  shall  be  from  time  to 
time  executed  by  or  on  behalf  of  the  Promisors  and  delivered 
to  the  Trustee,  and  shall  thereupon  be  authenticated  and 
delivered  by  the  Trustee  as  follows: 

Whenever  there  shall  be  delivered  to  the  Trustee 
a certificate  signed  by  the  Promisors  or  a majority  of 
them,  stating  that  the  Promisors  have  loaned  or  advanced 
the  sum  stated  in  the  certificate  to  one  of  the  Controlled 
Companies,  or  arranged  or  agreed  to  do  so  for  the  pur- 
pose of  enabling  such  Controlled  Company  to  pay  off 
existing  indebtedness  or  acquire  additional  property  or 
assets,  or  provide  working  capital  or  funds  to  enable 
said  Company  to  enlarge  or  extend  its  business,  or  that 
the  Promisors  have  expended  or  have  agreed  to  expend 
the  amount  stated  in  such  certificate  for  the  purpose  of 
acquiring  the  capital  stock  (or  a portion  thereof)  of  an- 
other corporation,  the  acquisition  of  which  is  by  the 
Promisors  deemed  beneficial  to  the  interests  of  the  Prom- 
isors and  Controlled  Companies  and  of  the  noteholders, 
the  Trustee  shall  authenticate  an  amount  of  notes  equal 


21 


in  face  amount  to  the  amount  specified  in  such  certificate, 
and  deliver  the  same  with  all  unmatured  coupons  apper- 
taining thereto,  to  or  upon  the  written  order  of  the 
Promisors  or  a majority  of  them,  provided,  however, 
that  none  of  said  notes  shall  be  so  authenticated  and  de- 
livered unless  there  shall  be  filed  with  the  Trustee.,  (a) 
a certificate  signed  by  a vice  president  of  the  Continental 
and  Commercial  Trust  and  Savings  Bank,  Chi- 
cago, and  a Vice  President  of  the  First  National  Bank  in 
St.  Louis  approving  the  issuance  .of  such  notes;  and 
(b)  a certificate  signed  by  a majority  of  the 
Promisors  that  there  is  not  at  the  time  any  ex- 
isting default  under  this  indenture;  and,  (c)  a cer- 
tificate of  a certified  public  accountant  approved  by  the 
Trustee  that  at  the  close  of  the  then  last  preceding  fiscal 
year  of  the  Promisors  and  of  the  Controlled  Companies, 
or  at  a date  not  more  than  ninety  (90)  days  prior  to  the 
date  of  such  application  for  the  issuance  of  said  addi- 
tional notes,  the  aggregate  quick  assets  of  the  Promisors 
and  the  Controlled  Companies  (as  such  quick  assets  are 
hereafter  defined  in  paragraph  (n)  of  Section  1 of  Arti- 
cle II  of  this  indenture)  was  at  least  one  and  one-half 
times  the  aggregate  net  debt  of  the  Promisors  and  Con- 
trolled Companies  (as  the  said  net  debt  is  hereinafter) 
defined  in  said  paragraph  (n)  of  Section  1 of  Article  II 
of  this  indenture),  including  the  indebtedness  evidenced 
by  the  notes  outstanding  under  this  indenture  and  the 
notes  requested  to  be  issued,  and  that  the  income  of 
the  Promisors  and  Controlled  Companies  during  the  last 
fiscal  year  or  during  a twelve-months  ’ period  ending  not 
more  than  ninety  days  prior  to  the  date  of  such  applica- 
tion was  not  less  than  three  (3)  times  the  aggregate  in- 
terest charges  of  the  Promisors  and  of  the  Con- 
trolled Companies  for  and  during  such  period,  including 
the  annual  interest  charge  on  the  notes  then  re- 
quested to  be  authenticated  hereunder.  In  computing 
said  income  there  shall  be  included  not  only  the  interest, 
dividends  and  other  moneys  in  any  way  actually  received 
by  them  (other  than  from  the  notes  issued  hereunder 
or  the  sale  of  capital  assets),  but  also  all  earnings  law- 
fully applicable  to  but  not  declared  in,  the  payment  of 
dividends  in  respect  of  any  Controlled  Company  after 
making  the  proper  deductions  for  income  apportionable 
to  shares  of  stock  of  any  companies  not  owned  by  the 
Promisors  or  by  a Controlled  Company;  but  there  shall 


22 


Application 
proceeds  of 
notes. 


Temporary 

notes. 


be  wholly  excluded  from  said  computation  all  moneys 
represented  by  interest  in  respect  of  intercorporate  ob- 
ligations, between  Controlled  Companies,  and  there  shall 
also  be  deducted  from  the  earnings  before  arriving  at  the 
amount  of  said  income  reasonable  charges  for  deprecia- 
tion and  taxes  of  all  kinds  (other  than  Federal  income 
taxes). 

In  computing  said  income  of  the  Promisors  and  Con- 
trolled Companies  there  shall  be  included  the  earnings  of 
the  Controlled  Companies,  but  there  shall  not  be  included 
the  amount  of  any  dividends  received  by  the  Promisors 
from  Controlled  Companies  on  account  of  such  earnings. 

Section  6.  The  net  proceeds  of  said  Seven  Million,  Five 
Hundred  Thousand  Dollars  ($7,500,000)  principal  amount  of 
said  notes  provide*!  forthwith  to  be  issued  shall  be  ap- 
plied first,  to  retire  and  redeem  any  secured  indebtedness  of 
the  Promisors  (other  than  the  indebtedness  created  by  this  in- 
denture), and,  second,  to  reduce  the  floating  indebtedness  of 
the  Promisors  and  of  the  Controlled  Companies,  and,  third , 
the  remainder  of  said  proceeds  shall  be  applied  and  used 
in  such  manner  as  the  Promisors  may  determine,  to  provide 
additional  working  capital  for  the  conduct,  extension  or  de- 
velopment of  the  business  of  the  Controlled  Companies. 

Section  7.  Until  the  definitive  notes  can  be  prepared  and 
issued  under  this  indenture,  the  Promisors  may  sign  or  au- 
thorize to  be  signed  in  their  behalf,  and  the  Trustee  shall 
thereupon  authenticate  and  deliver  in  the  same  manner  and 
under  the  same  kind  of  orders  as  for  the  definitive  notes, 
and  in  lieu  of  such  definitive  notes  and  subject  to  the  same 
provisions,  limitations  and  conditions,  temporary  typewritten, 
printed  or  lithographed  notes,  substantially  of  the  tenor  of  the 
definitive  notes  hereinbefore  recited,  except  that  no  coupon 
shall  be  attached  to  any  of  such  temporary  notes,  and  the 
same  may  be  for  the  payment  of  Five  Hundred  Dollars 
($500)  or  any  multiple  thereof.  Each  of  such  temporary  notes 
shall  bear  upon  its  face  the  words  “ Temporary  Seven  Per 
Per  Cent  Secured  Gold  Note,  exchangeable  for  definitive 


23 


notes/’  and  shall  be  authenticated  by  the  Trustee  in  the  same 
manner  as  the  definitive  notes,  and  such  authentication  shall 
be  conclusive  evidence  that  the  note  so  authenticated  has 
been  duly  issued  hereunder,  and  that  the  holder  is  entitled 
to  the  benefit  of  the  trusts  and  security  of  this  indenture. 
Such  temporary  notes  shall  be  exchangeable  at  the  office 
of  the  Trustee  without  charge  or  expense  to  the  holder  for 
a like  aggregate  principal  amount  of  temporary  notes  of  such 
different  denominations  as  the  Promisors  may  issue,  or  for 
a like  aggregate  principal  amount  of  definitive  notes  when 
the  same  are  ready  for  delivery,  and  upon  the  surrender 
of  any  such  temporary  notes  for  exchange  such  temporary 
notes  shall  forthwith  be  canceled  by  the  Trustee,  and  deliv- 
ered to  the  Promisors  on  their  written  demand.  The  Prom- 
isors covenant  and  agree  forthwith  to  cause  to  be  issued  at 
their  own  expense  definitive  notes  which  shall  be  executed 
and  delivered  by  the  Promisors  to  the  Trustee  in  order  to 
enable  the  Trustee  to  exchafige  the  same  for  temporary  notes. 
Until  so  exchanged  each  of  such  temporary  notes  shall  in  all 
respects  be  entitled  to  the  lien  and  security  of  this  indenture 
as  if  it  were  a definitive  note  issued  and  authenticated  here- 
under; and  interest  thereon,  when  and  as  payable,  shall  be 
paid  upoji  presentation  thereof,  and  such  payment  endorsed 
thereon. 

Section  8.  In  the  event  any  note  issued  hereunder  shall 
become  mutilated,  or  be  destroyed  or  lost,  the  Promisors  in 
their  discretion  may  issue,  and  thereupon  the  Trustee  shall 
authenticate  and  deliver,  a new  note,  of  like  tenor,  date  and 
amount,  bearing  the  same  number,  in  exchange  and  substi- 
tution for  and  upon  cancellation  of  the  mutilated  note  and 
its  coupons,  or  in  lieu  of  and  in  substitution  for  the  note  and 
its  coupons  so  destroyed  or  lost.  The  applicant  for  such 
substituted  note  shall  furnish  to  the  Promisors  and  to  the 
Trustee  evidence  of  the  destruction  or  loss  of  such  note,  and 
of  its  coupons  so  destroyed  or  lost,  which  evidence  shall  be 


Replacement 
of  mutilated, 
destroyed  or 
lost  notes. 


24 


satisfactory  to  the  Promisors  and  to  the  Trustee  in  their  dis- 
cretion, and  said  applicant  shall  also  furnish  indemnity  sat- 
isfactory to  the  Promisors  and  to  the  Trustee,  as  may  be  re- 
quired by  them,  and  shall  comply  with  such  other  reasonable 
regulations  as  may  be  prescribed  by  the  Promisors  or  the 
Trustee. 

?feffnotestion  Section  9.  The  coupon  notes  hereby  secured  shall  be  nego- 
tiable and  transferable  by  delivery,  unless  registered  for  the 
time  being  in  the  name  of  the  holder  in  books  kept  for  that 
purpose  by  the  Trustee  at  its  office  in  the  City  of  Chicago,  Illi- 
nois, such  registry  being  noted  on  the  note  or  notes  by  said 
Trustee,  after  which  no  transfer  of  such  note  or  notes  so 
registered  shall  be  valid  unless  made  on  such  books  by  the 
registered  holder  in  person,  or  by  his  attorney  duly  author- 
ized in  writing,  and  similarly  noted  on  said  note  or  notes; 
but  any  coupon  note  may  be  discharged  from  registration  by 
being  in  like  manner  transferred  thereon  to  bearer,  after 
which  it  shall  be  transferable  by  delivery.  The  registration 
of  any  coupon  note  shall  not  impair  the  negotiability  of  said 
coupons,  which  shall  always  continue  to  be  negotiable  and 
transferable  by  delivery,  notwithstanding  such  registration. 
The  Promisors  and  the  Trustee  shall  not  be  bound  to  take  no- 
tice of  any  trusts  appearing  on  or  referred  to  in  said  notes 
or  otherwise  with  respect  thereto,  and  may  transfer  the 
same,  on  the  direction  of  the  person  registered  as  holder 
thereof,  whether  named  as  trustee  or  otherwise,  as  though 
such  person  was  the  beneficial  holder  thereof.  All  expense 
of  registration  and  transfer  of  notes  shall  be  borne  by  the 
holder  thereof.  The  person  in  whose  name  any  note  shall 
be  registered  shall,  for  the  purposes  of  this  indenture,  be 
deemed  and  regarded  as  the  owner  thereof,  and  thereafter 
payment  of  the  principal  of  such  registered  note  shall  be 
made. only  to  or  upon  the  order  of  such  registered  holder 
thereof,  and  all  such  payments  shall  be  valid  and  effectual 
to  satisfy  and  discharge  liability  upon  such  notes,  to  the 


25 


extent  of  the  sum  or  sums  so  paid.  The  Promisors  and  the 
Trustee  may  deem  and  treat  the  bearer  of  any  note  which 
shall  not  at  the  time  he  registered,  as  hereinbefore  author- 
ized, and  the  bearer  of  any  coupon  for  interest  on  any  such 
note,  whether  such  note  be  registered  or  not,  as  the  abso- 
lute holder  of  such  note  or  coupon,  for  the  purpose  of  receiv- 
ing payment  therefor,  and  for  all  other  purposes  whatsoever; 
and  the  Promisors  and  the  Trustee  shall  not  be  affected  by 
any  notice  to  the  contrary. 


AKTICLE  II. 

COVENANTS  OF  THE  PROMISORS. 

Section  1.  The  Promisors  as  trustees  under  the  afore- 
said Agreement  and  Declaration  of  Trust  dated  as  of  April 
26,  1920,  and  not  individually,  covenant  and  agree  to  and  with 
the  Trustees : 

(a)  That  they  will  duly  and  punctually  pay  or  cause 
to  be  paid  the  principal  and  interest  of  every  note  is- 
sued hereunder  according  to  the  tenor  of  said  note  and 
coupons  attached  thereto,  in  gold  coin  of  the  United 
States  of  America  of  or  equal,  to  the  standard  of  weight 
and  fineness  existing  on  May  1,  1920,  and  without  deduc- 
tion for  any  tax  or  taxes  (except  federal  income  taxes 
in  excess  of  2%  and  inheritance  and  succession 
taxes)  which  the  Promisors  or  the  Trustees  or  the  Banks 
at  which  the  same  are  payable  may  be  required  to  pay 
thereon  or  to  deduct  or  retain  therefrom  under  any  pres- 
sent  or  future  constitution,  law  or  lawful  regulation  of 
the  United  States  or  of  any  state,  territory,  county,  mu- 
nicipality or  other  lawful  taxing  authority  therein. 

(b)  That  they  will  pay  to  the  Trustee  on  demand,  as 
hereinafter  provided,  such  sum  or  sums  of  money  as 
shall  be  sufficient  to  reimburse  the  holder  of  any  notes 
issued  hereunder  for  all  taxes  (other  than  inheritance  and 
succession  taxes)  not  exceeding  in  the  aggregate  four 
mills  per  annum  on  each  dollar  of  the  principal  amount 
of  such  notes,  paid  by  them  and  assessed  by  the  Common- 
wealth of  Pennsylvania  upon  such  notes  or  upon  the  hold- 


covenants  of 
Promisors. 


Covenant  to 
pay  principal 
and  interest. 


Tax  refund 
under  Pennsyl- 
vania laws. 


Covenant  to 
pay  taxes,  etc., 
on  trust  estate 
and  on  prop- 
erty, etc.,  of 
Fromisors  and 
Controlled 
Companies. 


ers  thereof  as  residents  of  said  Commonwealth  by  reason 
of  their  ownership,  upon  the  written  request  of  the  hold- 
ers for  such  reimbursement.  Said  request  shall  state 
the  serial  numbers  of  the  notes  and  set  forth  that  the 
owners  were  the  holders  thereof  at  the  time  when  such 
demand  was  made  and  that  such  taxes  were  assessed  upon 
such  notes  or  assessed  upon  such  holders  as  residents  of 
the  Commonwealth  of  Pennsylvania  holding  said  notes 
and  paid  by  them,  and  such  request  shall  be  made  to  the 
Trustee  in  writing  at  its  office  in  the  City  of  Chicago, 
Illinois,  within  a period  of  six  months  from  the  date  of 
payment  of  said  taxes  by  said  holders.  The  Prom- 
isors shall  not  be  liable  to  reimburse  said  holders 
for  any  taxes  unless  such  request  shall  be  made  within 
said  period  of  time,  and  they  shall  in  no  event  be  liable 
to  reimburse  such  holders  for  any  interest  or  penalty 
assessed  upon  or  paid  by  them  in  addition  to  the  amount 
of  the  said  taxes  as  originally  assessed.  Upon  receipt 
of  any  request  for  reimbursement  the  Trustee  shall 
with  reasonable  promptness  furnish  the  Promisors  at 
such  office  as  the  Promisors  shall  designate,  a copy  of  the 
same,  and  the  Trustee  shall  thereafter  pay  to  each 
holder  of  said  notes  making  such  request  a sum  suffi- 
cient to  reimburse  said  payment  of  taxes  as  herein  pro- 
vided, when  and  as  directed  so  to  do  by  the  Promisors 
out  of  the  funds  deposited  with  the  Trustee  by  the  Prom- 
isors for  that  purpose. 

(c)  That  they  will  from  time  to  time  duly  pay  and 
discharge  all  taxes,  assessments  and  governmental 
charges  or  levies  lawfully  imposed  upon  the  trust  es- 
tate or  any  part  thereof,  or  upon  the  income  and  profits 
thereof,  and  upon  the  income  and  profits  of  the  Prom- 
isors and  of  the  Controlled  Companies  and  their  prop- 
erties as  and  when  the  same  become  due  and  payable,  and 
also  all  taxes,  assessments  and  governmental  charges 
lawfully  imposed  upon  the  lien  or  interest  of  the  Trus- 
tees or  of  the  holders  of  the  notes  in  respect  to  the 
trust  estate;  provided,  however,  that  unless  such  pay- 
ments shall  be  necessary  in  the  opinion  of  the  Trustees 
in  order  to  prevent  prejudice  or  loss  to  the  trust  es- 
tate, the  Promisors  shall  not  be  required  to  pay  any  such 
taxes  or  assessments  or  governmental  charges  so  long 
as  in  good  faith  they  shall  contest  the  validity  thereof  by 
appropriate  legal  proceedings;  and  in  the  event  the 
Promisors  or  the  Controlled  Companies  or  any  of  them 


27 


shall  fail  seasonably  to  pay  such -taxes,  assessments  or 
governmental  charges  the  Trustees  (or  either  of  them) 
may  at  their  option  pay  such  taxes,  assessments  or  gov- 
ernmental charges  without  prejudice,  however,  to  the 
rights  of  the  Trustees  or  note  holders  hereunder  arising 
in  consequence  of  such  failure,  and  the  amount  so  paid 
by  the  Trustees  (or  either  of  them)  with  interest  thereon 
from  the  date  of  payment  until  paid  at  the  rate  of  seven 
per  cent  (7 °/o)  per  annum  shall  be  repaid  by  the  Promisors 
upon  demand,  and  shall  become  so  much  additional  in- 
debtedness secured  by  this  indenture,  and  shall  be  paid 
out  of  the  proceeds  of  any  sale  of  the  trust  estate  or  out 
of  any  funds  received  by  the  Trustees  (or  either  of  them) 
hereunder  if  not  otherwise  paid  by  the  Promisors;  but 
the  Trustees  shall  be  under  no  obligation  to  pay  any 
such  taxes,  assessments  or  other  governmental  charges 
unless  fully  indemnified  against  the  expense  thereof,  and 
furnished  with  the  means  therefor. 

(d)  That  they  will  not  create  or  suffer  to  be  created 
any  lien  or  charge  whatsoever  against  the  trust  estate 
or  any  part  thereof  prior  to  the  lien  and  security  of  this 
indenture,  or  do  any  act  or  thing  whereby  the  lien  or 
security  hereof  may  be  impaired;  and  that  they  will  do 
all  things  necessary  to  protect  and  preserve  the  trust 
estate,  and  in  every  manner  protect  and  preserve  the 
security  of  the  notes  issued  hereunder. 

(e)  That  in  order  to  prevent  any  accumulation  after 
maturity  of  interest  coupons  they  will  not  directly  or  in- 
directly extend  or  assent  to  the  extension  of  time  for 
payment  of  any  coupon  or  interest  upon  any  notes  is- 
sued hereunder,  and  that  in  event  the  time  for  payment 
of  any  such  coupons  or  interest  shall  be  extended,  whether 
or  not  such  extension  shall  be  by  or  with  the  consent 
of  the  Promisors,  such  coupons  and  interest  shall  not  be 
entitled  in  event  of  default  hereunder  to  the  benefit  of 
the  security  of  this  indenture  except  subject  to  the  prior 
payment  in  full  of  the  principal  of  all  the  notes  issued 
hereunder,  then  outstanding,  and  all  matured  coupons 
and  interest  on  said  notes,  payment  of  which  has  not 
been  .so  extended. 

(f)  That  they  will  keep  or  cause  to  be  kept  proper 
books  or  records  of  account  in  which  full,  true  and  cor- 
rect entries  will  be  made  of  all  dealings  or  transactions 
of  or  in  relation  to  the  plants,  properties,  business  and 
affairs  of  the  Promisors  and  of  the  Controlled  Companies* 


Covenant  not 
to  create  any 
prior  lien  on 
trust  estate. 


Covenant  not 
to  extend  pay- 
ment interest 
coupons,  etc. 


Covenant  to 
keep  proper 
records  of 
accounts,  etc. 


28 


Covenant  as  to 
ownership  of 
trust  estate 
and  of  right 
to  pledge  same 
hereunder. 


Covenant  to 
pledge  addi- 
tional stocks, 
etc.,  thereafter 
acquired,  etc. 


Covenant  for 
further  assur- 
ances. 


Covenant  as  to 
insurance. 


which  shall  at  all  reasonable  times  be  open  to  the  inspec- 
tion of  the  Trustees  (or  either  of  them) ; that  they  will 
also  furnish  to  the  Trustee  and  to  the  Co-Trustee  a com- 
plete assets  and  liabilities  statement  and  audit,  and  a 
statement  of  the  earnings  of  the  Promisors  and  Con- 
trolled Companies  as  at  the  close  of  each  fiscal  year  and 
at  such  other  times  as  the  Trustee  or  Co-Trustee  may  re- 
quest; and  all  such  statements  and  audits  shall  be  cer- 
tified to  by  certified  public  accountants  satisfactory  to  the 
Trustees. 

(g)  That  the  Promisors  are  the  lawful  owners  of 
the  shares  of  stock  and  certificates  therefor  pledged  un- 
der this  indenture,  and  have  good  right,  full  power  and 
lawful  authority  to  pledge,  assign,  transfer  and  set 
over  the  same  in  the  manner  and  form  herein  done  or 
intended  to  be  done,  and  that  they  have,  and  subject  to 
the  provisions  hereof  will  preserve,  good  and  indefeasi- 
ble title  to  such  pledged  property  and  will  warrant  and 
forever  defend  the  same  to  the  Trustees  against  the 
claims  of  all  persons  whomsoever. 

(li)  That  they  will  pledge,  assign,  transfer,  set  over 
unto  the  Trustees  and  in  pursuance  thereof  deliver  to 
the  Trustee  any  and  all  additional  shares  of  stock  of  the 
companies  mentioned  in  List  I of  the  pledging  clauses  of 
this  indenture,  and  all  other  stocks,  notes,  bonds,  securi- 
ties and  other  claims  and  all  other  property  of  any  nature 
whatsoever  which  they  may  be  entitled  to  receive  as  trus- 
tees under  said  Agreement  and  Declaration  of  Trust 
dated  as  of  April  26,  1920,  hereafter  at  any  time  acquired 
by  them  or  on  their  behalf,  and  which  under  the  terms  of 
this  indenture  are  to  be  pledged  hereunder. 

(i)  That  they  will  from  time  to  time,  at  all  times 
hereafter,  on  reasonable  request  of  the  Trustees,  make, 
execute,  acknowledge  and  deliver  all  such  other  acts, 
transfers  and  assurances  for  the  better  assigning,  trans- 
ferring, assuring,  conveying  and  confirming  to  the  Trus- 
tees all  and  singular  the  trust  estate  at  any  time  subject 
or  to  be  subject  hereto,  as  may  be  reasonably  required 
by  the  Trustees,  to  carry  out  the  purpose  and  intent  here- 
of. 

(j)  That  at  all  times  during  the  existence  of  any  in- 
debtedness hereby  secured,  they  will  keep  or  cause  to 
be  kept  insured  against  loss  or  damage  by  fire,  to  the  rea- 
sonable insurable  value  thereof  all  the  plants,  houses, 


29 


warehouses,  buildings,  structures  of  every  kind,  machin- 
ery, equipment,  appliances,  merchandise  and  other  prop- 
erty of  the  Promisors  and  of  the  Controlled  Companies, 
such  as  are  usually  insured  by  persons  or  companies  en- 
gaged in  like  business,  and  if  required  by  the  Trustee 
they  will  cause  use  and  profit  or  use  and  occupancy  insur- 
ance and  such  other  forms  of  insurance  to  be  carried  and 
maintained  covering  such  warehouses,  plants,  and  prop- 
erties of  the  Controlled  Companies  and  to  such  an  amount 
as  may  be  deemed  proper  and  reasonable  by  the  Trus- 
tee (but  the  Trustee  shall  be  under  no  liability  in  de- 
termining whether  and  upon  what  properties  such  insur- 
ance shall  be  carried  and  in  what  amount,  and  in 
making  such  determination  may  accept  and  act  upon  the 
opinion  of  any  insurance  expert  or  advisor  selected  by 
it  for  that  purpose) ; that  when  requested  by  the  Trustee 
the  Promisors  or  their  insurance  agents  will  furnish  to 
the  Trustee  a list  or  lists  of  all  such  policies  which  shall 
show  the  names  of  the  companies  issuing  the  same,  the 
number  and  amount  of  each  policy,  the  dates  of  expira- 
tion, the  property  coveted  by  each  policy  and  the  name 
and  post  office  address  of  the  agent  issuing  the  same; 
and  if  so  requested  by  the  Trustee  the  said  policies  shall 
be  deposited  with  said  Trustee  and  from  time  to  time 
there  shall  be  furnished  to  the  Trustee  (if  so  required 
by  it)  evidence  showing  the  payment  of  insurance  pre- 
miums upon  the  said  policies.  In  event  of  any  loss  cov- 
ered by  any  policy  of  insurance  the  Promisors  covenant 
and  agree  that  they  shall  cause  the  insurance  moneys  so 
received  on  account  thereof  to  be  applied  toward 
the  repair,  replacement  of  or  addition  to  the 
property  destroyed  or  damaged,  or  to  the  ac- 
quirement of  other  properties  useful  in  connection 
with  the  business  of  the  Controlled  Companies.  In  event 
the  Promisors  fail  to  effect  insurance  as  aforesaid,  the 
Trustee  may  in  its  discretion  procure  such  insurance,  and 
all  moneys  paid  by  the  Trustee  for  such  insurance,  to- 
gether with  interest  thereon  at  the  rate  of  seven  per 
cent  per  annum  shall  be  repaid  by  the  Promisors  upon 
demand  and  shall  become  so  much  additional  indebted- 
ness secured  by  this  indenture,  and  shall  be  given  a pref- 
erence in  payment  over  any  of  said  notes  or  coupons, 
and  shall  be  paid  out  of  the  proceeds  of  any  sale  of  the 
trust  estate,  or  out  of  any  funds  received  by  the  Trus- 


30 


Covenant  to 
maintain  cor- 
porate exist- 
ence of 
Controlled 
Companies. 


Covenant  to 
maintain 
plants,  etc. 


Covenant  as  to 
borrowing’  of 
money  by 
Controlled 
Companies. 


Covenant  not 
to  mortgage 
property. 


Exception. 


tee  hereunder,  if  not  otherwise  paid  by  the  Promisors, 
before  any  payment  shall  he  made  on  said  notes  or  cou- 
pons. The  Trustee,  however,  shall  be  under  no  obligation 
to  effect  such  insurance  unless  fully  indemnified  against 
the  expense  thereof  and  furnished  with  means  therefor. 

(k)  That  until  this  indenture  shall  be  discharged  and 
canceled  they  will  not  suffer  or  permit  any  of  the  fran- 
chises or  rights  of  any  corporation,  all  of  whose  capital 
stock  or  a majority  thereof,  shall  be  then  subject  to  this 
indenture  as  a part  of  the  trust  estate,  to  lapse  or  be 
forfeited,  and  that  they  will  at  all  times  when  entitled 
so  to  do  under  the  terms  of  this  indenture,  vote  upon  any 
shares  to  the  end  that  spch  rights  and  franchises  may 
be  maintained  in  full  force  and  effect  so  long  as  the  same 
may  be  used  or  useful  in  the  business  of  said  corpora- 
tion. 

(l)  That  at  all  times  during  the  existence  of  any  of 
the  indebtedness  hereby  secured  they  will  cause  to  be 
maintained,  preserved  and  kept  in  good  order,  repair 
and  condition,  all  the  plants,  warehouses,  buildings,  ma- 
chinery, equipment  and  otheV  property  used  in  the  con- 
duct of  the  business  of  the  Controlled  Companies  so  that 
the  efficiency  of  said  property  shall  not  be  impaired. 

(m)  That  so  long  as  any  of  the  interest  or  principal 
of  the  notes  issued  and  outstanding  hereunder  shall  re- 
main unpaid,  none  of  the  Controlled  Companies  shall  bor- 
row any  money  except  from  the  Promisors,  and  that  there 
shall  not  be  created  or  placed  upon  any  of  the 
property  of  any  Controlled  Company  any  mort- 
gage indebtedness  in  addition  to  any  mortgage  in- 
debtedness now  outstanding  against  any  property 
of  any  Controlled  Company,  and  the  Promisors 
will  not  cause  or  permit  to  be  issued  under  any 
trust  deed  or  mortgage  now  outstanding  upon 
any  p-roperty  of  any  Controlled  Company  any  bonds  in 
addition  to  those  now  issued  and  outstanding,  or  under 
any  other  provisions  of  any  mortgage  or  trust  deed  au- 
thorizing the  authentication  and  delivery  of  additional 
bonds;  provided,  however,  that  with  the  written  consent 
of  the  Trustees,  additional  mortgage  indebtedness  may  be 
created  to  the  extent  of  seventy-five  per  cent  (75%)  of  the 
cost  of  additions,  extensions  or  improvements  to  existing 
real  property  owned  by  the  Controlled  Companies  at  the 
date  of  the  execution  of  this  indenture.  In  determining 
such  costs  the  Trustees  may  act  and  rely  upon  certificates 


31 


filed  with  them  describing  in  reasonable  detail  the  nature 
of  such  additions,  extensions  or  improvements,  and  the 
real  property  upon  which  such  additions,  extensions  or 
improvements  have  been  made,  and  the  name  of 
the  Controlled  Company  in  which  title  thereto  is 
vested,  signed  and  verified  by  an  engineer  or  ap- 
praiser or  other  person  satisfactory  to  the  Trus- 
tees and  accompanied  by  legal  opinion  of  counsel, 
satisfactory  to  the  Trustees,  certifying  as  to  the  title 
to  such  additions,  extensions  or  improvements  and  that 
title  thereto  is  vested  in  one  of  the  Controlled  Companies, 
subject  to  no  other  lien  (other  than  liens  for  current 
taxes),  but  the  lien  which  is  herein  authorized  to  be  cre- 
ated with  the  consent  of  said  Trustees ; and  the  Promisors 
covenant  and  agree  to  cause  said  Controlled  Companies 
to  enter  into 'such  agreements  with  the  Trustees  hereun- 
der as  may  be  appropriate  (in  the  opinion  of  the  attor- 
neys or  counsel  of  the  Trustees)  to  carry  out  the  cove- 
nants and  agreements  in  this  paragraph  contained. 

(n)  That  the  aggregate  quick  assets  of  the  Promisors  Covenant  as  to 
and  the  Controlled  Companies  shall  at  all  times  be  at  quick  assets- 
least  equal  in  actual  value  to  one  and  one-half  times 
their  aggregate  net  debt. 

The  term  “ quick  assets”  shall  mean — 

(1)  Cash  and  cash  items; 

(2)  Unpledged  good  accounts  receivable,  and 
short  time  bills  and  notes  and  acceptances  having  not 
more  than  six  months  to  run,  received  in  the  ordi- 
nary course  of  business  for  goods  sold; 

(3)  Merchandise  or  products  manufactured,  pro- 
duced, prepared,  or  in  the  process  of  manufacture, 
production  or  preparation,  and  raw  materials . (it 
being  understood  that  merchandise  and  materials 
shall  be  valued  at  the  actual  cost  without  interest 
if  such  cost  is  below  the  market  value  thereof  at 
the  time  of  valuation  hereunder,  but  at  the  market 
value  if  at  such  time  it  be  below  the  cost  thereof, 
and  that  in  the  term  “raw  material,’ ’ there  shall  be 
included  no  items,  except  such  as  are  then  in  transit 
or  are  at  some  plant  or  warehouse  of  a Controlled 
Company) ; and 

(4)  Such  other  items  as  are  generally  regarded 
as  working  capital  or  quick  assets  by  corporations 
conducting  a business  similar  to  that  of  the  Prom- 
isors or  Controlled  Companies,  including  therein 


32 


Definition  of 
net  debt. 


Definition  of 

Controlled 

Companies. 


Right  of 
Controlled 
Companies 
to  borrow  from 
Promisors. 


Covenant  to 

maintain  the 

trust  creating 

Associated 

Simmons 

Hardware 

Companies. 


Covenant 
waiving 
redemption, 
etc.,  laws. 


stocks  which  have  a determined,  available  and  realiz- 
able market  value  but  not  including  any  stock  or  cer- 
tificates therefor  pledged  hereunder. 

The  term  “net  debt”  shall  mean  the  aggregate  face 
amount  of  all. debts,  bonds,  notes  and  other  obligations, 
guaranties,  endorsements,  accounts  payable,  accrued  ren- 
tals, and  all  other  indebtedness  of  the  Promisors  and  the 
Controlled  Companies,  including  the  indebtedness  created 
and  outstanding  under  this  indenture  (but  excepting  in- 
tercorporate obligations  between  the  Controlled  Com- 
panies) and  deducting  therefrom: — (1)  such  now  existing 
indebtedness  as  is  secured  by  real  estate  mortgages  made 
by  a Controlled  Company  owning  real  estate  having  a 
value  of  at  least  twice  the  amount  of  such  mortgage  in- 
debtedness, and  any  mortgage  indebtedness  existing 
against  any  property  acquired  by  any  Controlled  Com- 
pany or  the  Promisors  at  the  time  of  such  acquirement 
and  any  renewals,  refunding  or  extensions  of  such  mort- 
gage indebtedness. 

The  term  “Controlled  Companies”  shall  mean  and  in- 
clude the  companies  shares  of  stock  of  which  are  pledged 
under  List  I of  the  pledging  clauses  of  this  indenture 
therein  described  as  Controlled  Companies. 

(o)  The  Controlled  Companies  may  issue  to  the  Prom- 
isors unsecured  notes  or  bills  payable  maturing  in  not 
more  than  seven  months  from  the  date  of  the  making 
thereof,  but  only  in  the  ordinary  course  of  current  oper- 
ations to  provide  funds  to  purchase  or  to  pay  for  mer- 
chandise, and  then  only  subject  to  the  provisions  of  para- 
graph (n)  of  Section  1 of  Article  II  of  this  indenture, 
which  notes  or  bills  payable  when  received  by  the  Prom- 
isors are  not  required  to  be  pledged  or  deposited  here- 
under, but  may  be  rediscounted  or  otherwise  dealt  with 
by  the  Promisors. 

(p)  That  until  all  notes  issued  and  to  be  issued  here- 
under shall  be  paid  in  full,  both  as  to  principal  and  in- 
terest, and  this  indenture  shall  have  been  fully  satisfied, 
the  organization  of  the  trust  established  by  said  Agree- 
ment and  Declaration  of  Trust  dated  as  of  April  26, 
1920,  shall  be  maintained,  unless  the  written  consent  of 
the  Trustees  waiving  the  requirements  and  provisions  of 
this  paragraph  is  obtained. 

(q)  That  they  will  not  at  any  time  insist  upon  or  take 
advantage  in  any  manner  whatsoever  of  any  valuation, 


33 


appraisement,  apportionment,  or  redemption  law,  or  any 
other  law  now  or  at  any  time  hereafter  in  force  which 
may  in  any  way  alter,  impair  or  modify  the  rights  and 
remedies  of  the  holders  of  the  notes  issued  hereunder,  or 
of  the  Trustees,  or  which  shall  change  the  time  or  place  or 
means  or  mode  of  perfecting  or  enforcing  such  rights  or 
remedies,  and  they  hereby  expressly  waive  all  benefit  and 
advantage  of  any  and  all  such  laws. 

(r)  That  in  the  event  of  any  suit  or  action  to  enforce 
the  collection  of  any  of  said  notes  or  interest  coupons, 
the  Promisors  shall  and  will  pay  such  reasonable  coun- 
sel and  attorneys ’ fees  as  may  be  allowed  by  order,  de- 
cree, or  judgment  of  the  court  in  which  such  suit  or  suits 
or  action  or  actions  may  be  brought. 

(s)  Nothing  in  this  indenture  contained  shall  be  con- 
strued to  prevent  the  placing  of  a mortgage  indebtedness 
of  not  to  exceed  Five  Hundred  Thousand  Dollars 
($500,000)  on  the  property  of  the  Grant  Leather  Corpora- 
tion, heretofore  authorized  by  said  corporation,  but  that 
the  creation  of  any  additional  mortgage  indebtedness  by 
said  corporation  shall  be  subject  to  the  same  restrictions 
as  contained  in  paragraph  (m)  of  Section  1 of  Article  II 
of  this  indenture  with  respect  to  the  creation  of  addi- 
tional mortgage  indebtedness  by  Controlled  Companies. 

Section  2.  Nothing  in  this  indenture  or  in  the  notes  and 
coupons  contained  with  respect  to  the  covenants  of  the  Prom- 
isors is  intended  or  shall  be  construed  to  give  to  any  person, 
firm  or  corporation,  other  than  the  parties  hereunder,  and 
the  holders  of  said  notes  and  coupons,  any  legal  or  equitable 
right,  remedy  or  claim  under  this  indenture,  all  said  cove- 
nants being  intended  to  be  and  being  for  the  sole  and  ex- 
clusive benefit  of  the  parties  hereto  and  of  all  holders  of 
notes  and  coupons  issued  hereunder  and  secured  hereby. 


ARTICLE  III. 

CONCERNING  THE  PLEDGED  SECURITIES. 

Section  1.  The  certificates  for  all  the  shares  of  stock 
enumerated  and  described  in  the  conveying  clauses  hereof 
and  pledged  under  this  indenture,  or  intended  so  to  be,  and 


Covenant  to 
pay  attorneys’ 
fees. 


Permission  for 
mortgage  for 
$500,000  of 
Grant  Leather 
Corporation. 


Covenants  for 
benefit  of  par- 
ties and  note- 
holders. 


Fledged 

securities. 


34 


Delivery  of 
pledged 
securities  to 
Trustee  and 
holding  of 
same  hy 
Trustee. 


Powers  of 
Trustee  with 
respect  to 
pledged  shares 
of  stock  as  to 
maintaining 
corporate 
existence, 
qualifying 
directors,  etc. 


the  certificates  for  other  shares  of  stock  which  shall  at  any 
time  hereafter  become  pledged  under  this  indenture;  or  in- 
tended so  to  be,  shall  be  delivered  to  the  Trustee,  duly  en- 
dorsed in  blank  for  transfer,  or  accompanied  by  an  assign- 
ment or  assignments  sufficient  to  transfer  the  title  thereto 
to  the  Trustee  hereunder,  or  to  the  nominee  or  nominees  of 
the  Trustee,  * As  hereinafter  provided,  the  Trustee  may  at 
any  time  cause  to  be  transferred  into  its  name,  as  Trustee 
hereunder,  any  and  all  shares  of  stock,  the  certificates  for 
which  shall  be  delivered  to  the  Trustee  hereunder,  or  in 
its  discretion  it  may  hold  such  certificates  in  the  name  of 
the  registered  holder  or  holders  thereof,  at  the  time  of  such 
pledge  and  delivery,  or  in  the  name  or  names  of  its  nominee 
or  nominees,  provided  that  in  either  case  such  certificate  or 
certificates  be  endorsed  in  blank  for  transfer,  or  be  accom- 
panied by  proper  instruments  of  assignment  in  blank,  duly 
executed  by  such  registered  holder.  The  Trustee  may  in  its 
discretion  at  any  time,  and  from  time  to  time,  stamp  or  cause 
to  be  stamped  any  or  all  of  the  certificates  pledged  hereun- 
der, in  such  manner  as  to  indicate  that  the  same  are  held 
hereunder,  and  are  subject  to  be  disposed  of  only  as  pro- 
vided in  this  indenture. 

Section  2.  The  Trustee  may  do  whatever  may  be  necessary 
for  the  purpose  of  maintaining,  preserving,  renewing  or  ex- 
tending the  corporate  existence  of  any  corporation  any  shares 
of  the  stock  of  which  shall  be  held  by  the  Trustee  hereun- 
der, and  for  such  purpose  may  sell,  assign,  transfer  and  de- 
liver so  many  shares  of  stock  of  any  such  corporation  as 
may  be  necessary  to  qualify  persons  to  act  as  directors  of 
or  in  any  other  official  relation  to  said  corporation,  and,  when- 
ever the  Promisors,  not  being  in  default  hereunder,  shall  in 
writing  so  request,  stating  in  such  request  that  they  do  not 
have  any  or  a sufficient  number  of  shares  of  stock  for  that 
purpose,  the  Trustee  shall  assign  and  transfer  to  persons 
designated  by  the  Promisors  a sufficient  number  of  any  shares 


35 


which  shall  then  he  held  by  the  Trustee  hereunder  to  qualify 
such  persons  to  act  as  directors  of  or  in  any  official  relation 
to  such  corporation;  provided,  however,  that  in  every  such 
case  the  Trustee  shall  make  such  arrangements  as  it  shall 
deem  necessary  for  the  protection  of  the  Trustee  hereunder, 
in  respect  to  the  shares  so  assigned,  and  in  such  case  in  its 
discretion  may  require  the  person  to  whom  such  shares  are 
transferred  to  agree  on  such  terms  and  for  such  price  as 
may  he  agreed  upon  between  the  Trustee  and  such  person  to 
retransfer  the  same  and  deliver  the  certificates  therefor  to  it, 
under  and  subject  to  this  indenture,  and  may  make  such 
other  arrangements  as  may  be  necessary  for  the  protection 
of  the  trust  hereby  created. 

Section  3.  Unless  and  until  an  event  of  default  (as  herein- 
after in  Section  1 of  Article  VIII  defined)  shall  happen 
and  be  continuing,  the  Promisors  shall  have  the  right  to  vote 
upon  or  consent  with  respect  to  all  shares  of  stock  at  tho 
time  pledged  hereunder,  for  all  purposes  not  contrary  to  the 
covenants  herein  contained  or  otherwise  inconsistent  with 
the  provisions  or  purposes  of  this  indenture,  with  the  same 
force  and  effect  as  though  such  shares  were  not  subject  to 
this  indenture.  From  time  to  time  (until  the  happening  of 
an  event  of  default,  as  aforesaid)  upon  the  written  request 
of  the  Promisors  the  Trustee  or  the  Trustees  shall  execute  and 
deliver,  or  cause  to  be  executed  and  delivered,  to  the  Prom- 
isors, or  to  their  nominee  or  nominees,  suitable  powers  of 
attorney  or  proxies  to  vote  upon  and  give  any  consent,  in 
respect  of  such  shares  of  stock,  which  proxies  shall  con- 
tain upon  their  fa-ce  such  restrictions  as  in  the  opinion  of  the 
Trustee  or  the  Trustees  may  be  necessary  to  carry  out  the 
provisions  of  this  indenture,  including  the  covenants  and 
agreements  of  the  Promisors  contained  in  paragraph 
(m)  of  Section  1 of  Article  II  of  this  indenture  and 
in  this  section.  In  case  the  laws  of  any  state  or  country 
under  which  any  corporation  whose  shares  of  stock 


Voting-  of 
shares  of 
stock  pledg-ed 
hereunder. 


36 


Application  of 
dividends  upon 
pledg-ed  shares 
of  stock. 


are  pledged  hereunder  shall  be  organized,  or  the  by-laws  of 
any  such  corporation  made  pursuant  thereto,  shall  require 
the  deposit  of  the  certificates  of  such  stock,  and  the  issuance 
of  any  receipt  or  other  evidence  of  deposit  or  ownership,  or 
the  right  to  vote  upon  or  give  any  consent  in  respect  of  such 
stock,  then  the  Trustee  (no  event  of  default  hereunder  having 
happened  and  being  continuing  as  aforesaid)  may  either  itself 
become  the  depositary,  and  as  such  issue  the  proper  receipt  or 
receipts,  or  make  deposit  of  certificates  with  any  bank  or 
trust  company  approved  by  the  Trustee,  and  obtain  against 
such  deposit  a proper  receipt  or  receipts,  which  receipt  or 
receipts  in  either  case  shall,  under  such  reasonable  restric- 
tions as  the  Trustee  may  impose,  be  delivered  as  the  Prom- 
isors or  any  one  of  them  shall  in  writing  direct,  to  the  end 
that  the  Promisors  may  exercise  such  right  to  vote  or  give 
consent. 

Section  4.  Unless  and  until  an  event  of  default  (as  here- 
inafter in  Section  1 of  Article  VIII  of  this  indenture 
defined)  shall  happen  and  be  continuing,  and  except  as  here- 
inafter otherwise  provided,  the  Promisors  shall  be  • entitled 
to  receive  any  cash  dividend  which  may  from  time  to  time 
be  declared  and  paid  upon  shares  of  stock  pledged  hereun- 
der, although  such  may  have  been  transferred  into  the  name 
of  the  Trustee  or  a nominee  or  nominees  of  the  Trustee,  andt 
the  Trustee  shall  be  entitled  to  assume  that  any  dividend  re- 
ceived in  money  is  paid  out  of  the  revenue,  income  or  pro- 
ceeds of  the  operation  of  the  corporation  declaring  such 
dividend,  and  not  upon  the  dissolution  or  liquidation  of  such 
corporation  or  upon  a reduction  of  its  capital  stock,  unless 
the  Trustee  shall  be  notified  in  writing  to  the  contrary.  Any 
sum  which  shall  be  paid  to  the  Trustee  or  Trustees 
on  a dissolution  or  liquidation  of  any  corporation, 
any  of  the  stock  of  which  is  pledged  hereunder,  or 
upon  the  reduction  of  the  capital  stock  of  any  such 
corporation,  any  of  the  stock  of  which  is  pledged 


37 


hereunder,  as  a dividend  on  the  shares  of  stock  of  such  com- 
pany, shall  be  held  by  the  Trustee  for  the  payment  of  the 
principal  of  the  notes  issued  hereunder  and  be  applied  toward 
the  payment  of  such  principal  when  it  becomes  due,  or  at 
the  option  of  the  Promisors  shall  be  applied  by  the  Trustee 
to  the  purchase  in  the  open  market  or  in  such  manner  as  the 
Trustee' may  determine  of  notes  issued  under  this  indenture 
at  a price  not  exceeding  the  price  at  which  said  notes  may 
at  the  next  ensuing  interest  date  be  redeemable,  and  in  the 
event  the  notes  cannot  be  purchased  at  such  price  to  exhaust 
such  sum,  then  at  the  election  of  the  Promisors,  such  amounts 
as  may  not  exhaust  said  sum  may  be  used  for  the  redemption 
of  notes  in  the  manner  provided  in  Article  IV  of  this  inden- 
ture. Any  notes  issued  under  this  indenture  when  so  pur- 
chased shall  be  canceled  by  the  Trustee  and  delivered  to  the 
Promisors. 

Section  5.  Unless  and  until  an  event  of  default  (as  here- 
inafter in  Section  1 of  Article  VIII  of  this  indenture  defined) 
shall  happen  and  be  continuing — 

(a)  Any  of  the  Controlled  Companies  may  be  merged 
or  consolidated  with  any  other  Controlled  Company,  or 
all  or  any  part  of  the  property  of  any  such  Controlled 
Company  may  be  sold  or  leased  to  any  other  Controlled 
Company,  whether  now  existing  or  hereafter  organized, 
provided  that  there  are  pledged  under  this  indenture  all 
of  the  shares  of  stock  of  each  of  said  companies  or  of 
the  company  resulting  from  such  merger  or  consolida- 
tion, except  such  shares  as  may  be  necessary  to  qualify 
directors ; and  upon  request  of  the  Promisors,  the  Trustee 
is  authorized  in  its  discretion  to  consent  to  all  acts  proper 
to  carry  into  effect  the  purposes  of  this  paragraph. 

(b)  The  Promisors  may  elect  to  vote  for  the  amend- 
ment or  alteration  of  the  articles  of  association,  certi- 
ficate of  incorporation  or  by-laws  of  any  Controlled 
Company  in  all  respects  which  shall  not  be  disapproved 
by  the  Trustee  as  detrimental  to  the  holders  of  the  notes 
hereby  secured,  or  for  the  increase  or  reduction  of  the 
capital  stock  of  any  such  Controlled  Company,  provided 
that  in  case  such  stock  be  increased  through  or  by  a 


Merger  or  con- 
solidation of 
Controlled 
Companies. 


Amendments 
or  alterations 
of  charters  or 
by-laws  of 
Controlled 
Companies, 
and  increase  or  t 
decrease  of 
stock  of  such 
companies. 


38 


Release  of 

pledged 

securities. 


In  case  of  sale 
or  exchange  of 
pledged 
securities. 


In  case  of  sale 
of  all  the 
property  of  a 
corporation. 


stock  dividend,  the  pro  rata  share  of  such  increased  stock 
to  which  the  Promisors  shall  be  entitled  shall  be  delivered 
to  the  Trustee  and  be  included  in  the  securities  pledged 
hereunder;  and  provided,  also,  that  in  case  of  the  re- 
duction of  such  stock,  the  pro  rata  share  of  such  stock 
as  reduced  to  which  the  Promisors  shall  be  entitled, 
shall  remain  included  in  the  securities  pledged  hereun- 
der, and  that  the  remainder  thereof  shall  be  surrendered 
for  cancellation;  and  any  sum  or  sums  of  money  or  other 
thing  of  value  to  which  the  Promisors  may  be  entitled 
upon  any  distribution  of  assets  of  such  corporation  by 
reason  of  such  reduction  of  stock  shall  be  deposited  with 
the  Trustee  to  be  held  by  it  and  applied  as  hereinbefore 
in  Section  4 of  Article  III  provided. 

(c)  The  Trustee  shall  from  time  to  time  release  from 
the  lien  hereof  and  surrender  to  the  Promisors  or  upon 
their  written  order  any  of  the  securities  pledged  here- 
under upon  there  being  delivered  to  it  a certificate  signed 
by  the  Promisors  or  their  agent  duly  authorized  there- 
unto requesting  such  release  and  delivery  and  setting 
forth  that 

(1)  The  Promisors  have  sold  or  exchanged  the 
shares  of  stock  or  other  securities  mentioned  in  such 
certificate  then  included  in  the  trust  estate  and 
stating  the  proceeds  realized  or  to  be  realized  from 
such  sale,  or  the  amount  and  character  of  shares 
of  stock,  participation  shares,  trust  certificates,  cer- 
tificate of  interest,  bonds,  notes,  or  other  securities, 
whether  made  or  issued  by  one  or  more  corpora- 
tions, voluntary  associations,  trustees  or  otherwise, 
which  have  been  or  are  to  be  received  in  exchange 
therefor ; or 

(2)  The  physical  property,  franchises  and  as- 
sets of  any  corporation,  any  part  of  whose  shares 
of  stock  is  included  in  the  trust  estate  which  have 
been  sold  or  exchanged  as  an  entirety  or  substan- 
tially so,  and  stating  the  amount  of  the  proceeds 
realized  or  to  be  realized  from  such  sale,  or  the 
amount  and  character  of  the  bonds,  notes,  shares  of 
stock,  participation  shares,  trust  certificates,  certifi- 
cates of  indebtedness  or  other  securities,  whether 
made  or  issued  by  one  or  more  corporations,  volun- 
tary associations,  trustees  or  otherwise  which  have 
been  or  are  to  be  received  in  exchange  therefor,  or 


39 


(3)  Any  corporation  any  of  whose  shares  of 
stock  are  included  in  the  trust  estate  has  been  merged 
with  or  consolidated  with  or  sold  to  any  other  such 
corporation  whether  now  existing  or  hereafter  or- 
ganized, stating  the  terms  of  such  merger  and  con- 
solidation or  sale  in  so  far  as  the  same  shall  relate 
to  such  securities  in  the  trust  estate. 

Provided  that  in  every  such  case  there  shall  be  filed 
with  the  Trustee  a certificate  consenting  thereto  signed 
by  a Vice  President  of  the  Continental  and  Commercial 
Trust  and  Savings  Bank,  Chicago,  and  a Vice  President 
of  the  First  National  Bank  in  St.  Louis  and  that  there- 
upon the  Trustee  shall  surrender  to  the  Prom- 
isors or  upon  their  written  order,  any  of  the 
securities  pledged  hereunder,  and  that  there  shall  be 
delivered  to  the  Trustee  to  be  held  as  part  of  the  securi- 
ties pledged  hereunder  the  proceeds  of  any  sale  or  the 
bonds,  notes,,  or  shares  of  stock,  participation  shares, 
trust  certificates,  certificates  of  interest  or  other  securi- 
ties, whether  made  or  issued  by  corporations,  voluntary 
associations,  trustees  or  otherwise  which  have  been  or 
are  to  be  received  in  exchange  for  the  securities  requested 
to  be  released  or  the  shares  of  stock  of  the  consolidated 
corporation  and  other  bonds,  notes,  participation  shares, 
trust  certificates,  certificates  of  interest  or  other  securi- 
ties applicable  to  or  received  for  the  shares  of  stock  then 
requested  to  be  released,  in  every  case  as  may  be  speci- 
fied in  the  certificate  of  said  Promisors  or  their  agents. 
The  Trustee  shall  incur  no  liability  whatsoever  in  re- 
spect to  any  action  or  step  taken  by  it  under  the  pro- 
vision of  this  section  which  is  believed  in  good  faith  to 
be  authorized  or  directed  by  the  Promisors,  and  con- 
sented to  as  aforesaid. 

Section  6.  Anything  in  this  indenture  to  the  contrary  not- 
withstanding, neither  the  shares  of  stock  nor  obligations  of 
any  of  the  Controlled  Companies  nor  the  physical  property, 
franchises  and  assets  of  any  of  such  companies  as  an  en- 
tirety or  substantially  so,  shall  be  sold,  exchanged  or  re- 
leased from  the  lien  of  this  indenture,  nor  shall  any  Con- 
trolled Company  be  merged  or  consolidated  with  any  cor- 
poration whatsoever  except  as  follows: 

(a)  Upon  such  terms  as  the  Trustees  in  their  discre- 


In  case  of 
merger  or 
consolidation. 


Consent  to 
releases. 


Substitution  of 
other  securi- 
ties, etc.,  for 
released 
securities. 


Prohibition  of 
sale,  exchange 
or  release  of 
stock  or  all 
property  of 
Controlled 
Companies 
except  as  here- 
in provided. 


40 


Release  of 
pledg-ed  securi- 
ties for  cash  or 
other  securi- 
ties. 


tion  and  without  liability  for  the  exercise  of  such  discre- 
tion may  determine  to  be  for  the  best  interests  of  the 
Promisors  and  the  holders  of  the  notes  issued  hereunder; 
or 

(b)  The  shares  of  stock  or  the  physical  property, 
franchises  and  assets  aforesaid,  may,  with  the  written  con- 
sent of  the  Trustees  in  their  discretion,  be  sold  or  ex- 
changed in  consideration  of  the  shares  of  stock,  partici- 
pation shares,  trust  certificates  or  certificates  of  in- 
terest of  a corporation  or  corporations,  voluntary  asso- 
ciation or  associations,  trustees  or  otherwise,  a proportion 
of  whose  entire  outstanding  shares  or  certificates  equal 
to  the  proportion  of  the  shares  now  held  by  the 
Promisors  or  by  one  or  more  of  the  Controlled  Com- 
panies in  the  companies  whose  shares  of  stock,  physical 
properties,  franchises  and  assets  are  so  sold,  exchanged 
or  released,  shall  under  the  provisions  of  Section  5 of 
this  Article  III  forthwith  upon  the  consummation  of  such 
sale,  exchange  or  release  become  a part  of  the  trust 
estate;  or 

(c)  The  obligations  aforesaid  may,  with  the  written 
consent  of  the  Trustees  in  their  discretion,  be  sold,  ex- 
changed or  released  in  consideration  of  obligations  of  like 
tenor  and  amount  (subject  to  like  covenants  and  condi- 
tions and  secured  by  like  securities)  of  a corporation  or 
corporations,  voluntary  association  or  associations,  trus- 
tees or  otherwise  whose  shares  of  stock  shall,  in  the 
proportions  and  in  the  manner  in  paragraph  (b)  of  this 
Section  6 above  provided  be  or  become  subject  to  this 
indenture;  or 

(d)  Any  Controlled  Company  may,  with  the  written  con- 
sent of  the  Trustees  in  their  discretion,  merge  or  con- 
solidate with  any  corporation  whatsoever  provided  that 
the  shares  of  stock  of  the  corporation  resulting  from 
such  merger  or  consolidation  shall  in  the  proportions, 
and  in  the  manner  in  paragraph  (b)  of  this  Section 
6 be  or  become  subject  to  this  indenture. 

Section  7.  Unless  and  until  there  be  an  event  of  default, 
(as  defined  in  Section  1 of  Article  VIII  of  this  indenture),  the 
Promisors  may  at  any  time,  and  from  time  to  time,  upon  de- 
positing cash  or  other  securities,  as  hereinafter  provided, 
with  the  Trustee,  in  lieu  of  or  in  exchange  for  any  securi- 
ties held  by  the  Trustee  hereunder,  withdraw  from  the  pledge 


41 


hereunder,  and  it  shall  thereupon  he  the  duty  of  the  Trustee 
to  deliver,  upon  the  written  order  of  a majority  of  the  Prom- 
isors, such  securities  as  they  may  specify,  provided  such  writ- 
ten order  shall  he  accompanied  by 

(1)  A certificate  of  Continental  and  Commercial  Trust 
and  Savings  Bank,  of  Chicago,  Illinois,  and  First  Na- 
tional Bank  in  St.  Louis,  signed  for  each  by  one  of 
its  Vice  Presidents,  consenting  to  such  release,  and  cer- 
tifying to  the  amounts  of  money  or  the  amounts  and  char- 
acter of  other  securities  that  must  he  deposited  and 
pledged  hereunder  with  the  Trustee  in  order  to  secure 
such  release;  and 

(2)  A statement  signed  and  sworn  to  by  one  of  the 
. Promisors,  declaring  that  the  market  value,  and  also  the 

actual  value,  of  the  securities  desired  to  he  withdrawn 
does  not  exceed  the  sum  or  sums  of  money  to  he  deposited 
with  the  Trustee  to  take  the  place  of  the  securities  so  de- 
sired to  he  withdrawn  (or,  in  event  that  securities  instead 
of  cash  are  deposited,  the  market  and  also  the  actual  value 
of  the  securities  to  he  substituted  for  the  securities  de- 
sired to  be  withdrawn),  and  further  stating  that  the  Prom- 
isors are  not  in  default  in  respect  to  any  covenant  or 
obligation  in  this  indenture  or  in  said  notes  and  coupons 
contained;  and 

(3)  Cash  equal  in  amount,  and  securities  of  the 
amount  and  character  specified  in  the  certificate  of  said 
Continental  and  Commercial  Trust  and  Savings  Bank  and 
said  First  National  Bank  in  St.  Louis  to  he  deposited  in 
order  to  secure  said  release  of  the  securities  so  desired 
to  be  withdrawn. 

The  Trustee  shall  he  under  no  responsibility  as  to  the  value  Trustee  as  to 

tgIg^sgs* 

or  disposition  of  the  securities  withdrawn,  hut  shall  he  fully 
protected  in  delivering  said  securities  upon  receipt  by  it  of 
the  certificates  and  orders  aforesaid,  and  of  the  sum  or  sums 
of  money  or  other  securities  therein  specified  as  necessary  to 
he  deposited  in  order  to  secure  such  release.  Such  cash  so 
deposited,  shall  he  held  by  the  Trustee  as  part  of  the  Trust 
estate,  and,  at  the  option  of  the  Promisors,  and  with  the  con- 
sent of  the  Trustee,  may  he  applied  by  the  Trustee  to  the  pur- 
chase in  the  open  market  of  outstanding  notes,  at  a price  not 


42 


Partial 
releases  of 
pledged  securi- 
ties on  pay- 
ment of  part 
of  notes. 


Liability  of 
Trustee  as  to 
releases. 


General  powers 
of  Trustee  with 
respect  to 
pledged  securi- 
ties and  pro- 
tection thereof. 


more  than  the  amount  required  to  be  paid  at  such  time  for  the 
redemption  of  outstanding  notes,  and  in  event  sufficient  notes 
cannot  be  thus  purchased  to  exhaust  said  cash  funds  the 
Promisors  may,  with  the  consent  of  the  Trustee,  use  any 
balance  of  said  moneys  not  used  for  the  purchase  of  notes 
toward  the  redemption  of  outstanding  notes,  in  the  manner 
provided  in  Section  1 of  Article  IV  of  this  indenture. 

Section  8.  Unless  and  until  there  be  an  event  of  default 
as  specified  in  Section  1 of  Article  VIII  of  this  indenture,  the 
Promisors  shall  be  entitled  to  have  released  from  the  lien  of 
this  indenture,  and  redelivered  to  them  by  the  Trustee,  from 
time  to  time,  as  outstanding  notes  are  called  for  redemption’ 
and  paid  or  provision  made  for  the  payment  thereof,  such 
proportionate  amounts  of  securities  pledged  hereunder  as 
may  be  determined  and  specified  in  a certificate  of  Continental 
and  Commercial  Trust  and  Savings  Bank,  of  Chicago,  and 
First  National  Bank  in  St.  Louis,  of  St.  Louis,  signed  for 
each  by  one  of  its  Vice  Presidents. 

Section  9.  The  Trustee  shall  not  be  liable  for  any  releases 
of  securities  improvidently  made  by  it  under  the  terms  of  this 
Article,  but  shall  in  all  respects  be  released  from  all  liability 
whatsoever  with  respect  to  such  releases  upon  having  re- 
ceived the  orders,  certificates  and  requests  referred  to  in 
this  Article,  and  upon  proof  having  been  made  to  it  of  the 
payment  or  provision  for  payment  of  notes  issued  under  this 
indenture,  as  specified  in  such  orders  and  requests. 

Section  10.  The  Trustees  (or  either  of  them)  may  at  any 
time  take  such  steps  as  in  their  discretion  they  shall  deem 
advisable  to  protect  their  interests  and  the  interests  of 
the  note  holders  hereunder  in  respect  of  any  shares 
of  stock  comprising  any  part  of  the  trust  estate  and 
may  join  in  any  plan  of  reorganization  or  read- 
justment in  respect  of  any  such  shares  of  stock  and 
may  accept  new  stocks  or  other  securities  issued  in  exchange 


43 


therefor  on  reorganization  and  readjustment.  Any  new 
stocks  or  other  securities  so  received  shall  be  held  by  the 
Trustee  subject  to  the  lien  and  provisions  of  this  indenture, 
hut  all  the  provisions  herein  contained  shall  he  applicable 
to  such  new  stocks  and  other  securities  in  like  manner  as 
the  shares  of  stock  in  exchange  for  which  they  were  issued. 

ARTICLE  IV. 

REDEMPTION  OF  NOTES.  Redemption  of 

notes. 

Section  1.  Unless  and  until  there  shall  be  an  event  of  de- 
fault as  defined  in  Section  1 of  Article  VIII  of  this  inden- 
ture, the  Promisors  at  their  option  may  redeem  any  or  all 
of  the  notes  at  any  time  outstanding  hereunder  in  advance 
of  their  maturity  at  any  interest  payment  date  by  paying 
the  principal  amount  of  such  notes  and  accrued  interest  there- 
on to  such  interest  payment  date  and  a premium  upon  said 
principal  of  the  following  amounts  on  notes  called  for  redemp- 
tion and  payment  in  the  following  years,  viz. : In  1920,  two  premium, 
and  one-half  per  cent ; 1921,  two  per  cent ; 1922,  one  and  one- 
lialf  per  cent;  1923,  one  per  cent;  1924,  one-half  per  cent; 

1925,  no  premium.  The  Promisors  shall  not  less  than  thirty- 

five  (35)  days  before  the  date  upon  which  any  notes  shall  Notice  of 

v 7 1 . . J redemption. 

be  redeemed  notify  the  Trustee  of  the  principal  amount  of 
notes  desired  to  be  redeemed,  and  if  the  principal  amount  of 
notes  to  be  redeemed  be  less  than  the  total  outstanding  notes, 
the  Trustee  shall  choose  by  lot  in  any  manner  by  it  deemed 
proper,  the  notes  to  be  redeemed,  and  thereupon  notice  shall 
be  given  by  the  Trustee  to  the  holder  or  holders  of  the  notes 
so-called  for  redemption,  by  advertisement  to  be  published 
at  least  once  a week  for  at  least  three  consecutive  weeks  in 
a daily  newspaper  of  general  circulation  published  in  Chicago, 

Illinois,  and  in  a daily  newspaper  of  general  circulation  pub- 
lished in  New  York  City,  New  York  and  in  a daily  newspaper 
of  general  circulation  published  in  Boston,  Massachusetts,  and 


44 


Payment  of 
notes  called  for 
redemption. 


Cancellation 
and  surrender 
of  redeemed  or 
paid  notes. 


Sufficiency  of 
notice. 


in  a daily  newspaper  of  general  circulation  published  in  St. 
Louis,  Missouri,  the  first  publication  of  such  notice  in  each 
case  to  be  at  least  twenty-five  (25)  days  before  the  date  fixed 
for  such  redemption.  Such  notice  shall  state  the  date  the  Prom- 
isors intend  to  redeem  said  notes  and  the  numbers  of  the 
notes  so  called  for  redemption  and  that  upon  and  after  the 
date  given  in  said  notice  and  upon  the  deposit  with  the  Trus- 
tee of  money  sufficient  to  pay  said  notes  and  coupons,  all 
interest  on  notes  so  called  for  redemption  shall  cease.  Upon 
depositing  with  the  Trustee  moneys  sufficient  to  pay  such 
notes  and  coupons  so  called  for  redemption,  said  notes  and 
coupons  shall  be  excluded  from  participation  in  the  lien 
of  any  security  afforded  by  this  indenture,  and  the  holders 
of  said  notes  and  coupons  shall  look  for  the  payment  thereof 
only  to  the  sums  so  deposited  with  the  Trustee  and  in  no 
event  to  the  Promisors.  Said  sums  so  deposited  shall  be 
held  by  the  Trustee  to  the  credit  of  and  for  the  payment  of 
such  notes  and  coupons,  and  shall  be  paid  by  the  Trustee  to 
the  holders  thereof  upon  presentation  and  surrender  of  said 
notes  together  with  the  outstanding  coupons  thereunto  be- 
longing. The  Trustee  may  arrange  for  the  payment  of  said 
notes  so  called  for  redemption  in  such  manner  as  it  may 
deem  proper  with  the  banks  at  which  the  principal  and  in- 
terest of  said  notes  are  payable  in  the  City  of  New  York,  in 
the  City  of  Boston  and  in  the  City  of  St.  Louis. 

Section  2.  All  notes  paid  or  redeemed  under  the  provi- 
sions of  this  Article  together  with  all  coupons  belonging 
thereto  upon  payment  thereof  shall  be  canceled  by  or  for 
the  Trustee  and  surrendered  to  the  Promisors. 

Section  3.  In  event  any  question  shall  arise  as  to  whether 
any  notice  provided  for  in  this  Article  IV  has  been  given,  such 
question  shall  be  decided  by  the  Trustee,  whose  decision  shall 
be  final  and  binding  upon  all  parties  in  interest. 


45 


Section  4.  On  deposit  with  the  Trustee  of  a sufficient  sum 
to  redeem  and  pay  all  the  notes  issued  under  this  indenture 
and  then  outstanding,  as  hereinabove  provided,  and  after  ar- 
ranging to  the  satisfaction  of  the  Trustee  for  the  publication 
and  giving  of  the  notice  of  redemption  as  required  by  this 
Article,  and  after  payment  to  the  Trustee  and  Co-Trustee  of 
their  reasonable  compensation,  expenses  and  disbursements, 
the  Trustee  shall  transfer  and  surrender  to  the  Promisors 
all  of  the  trust  estate  then  held  by  it  under  the  terms  of  this 
indenture,  and  this  indenture  shall  be  forthwith  canceled,  as 
fully  and  to  the  same  effect  as  if  the  total  issue  of  said  notes 
and  coupons  had  been  duly  paid  by  the  Promisors. 

Section  5.  In  case  any  of  the  notes  or  coupons  are  not 
presented  for  payment  within  three  years  after  the  maturity 
of  said  notes,  the  Trustee  shall  repay  to  the  Promisors  the 
balance  of  said  sum  so  deposited  then  remaining  in  its  hands 
by  reason  of  the  nonpresentation  of  said  notes  and  coupons, 
upon  receiving  from  the  Promisors  security  satisfactory  to 
the  Trustee  for  the  payment  of  such  notes  and  coupons  as 
may  thereafter  be  presented  for  payment. 

ARTICLE  V. 

INDIVIDUAL  IMMUNITY  OF  PROMISORS,  EXECUTIVE  COMMIT- 
TEE, AND  HOLDERS  OF  PARTICIPATION  CERTIFICATES. 

Anything  to  the  contrary  herein  notwithstanding,  it  is.  ex- 
pressly understood  and  agreed  that  this  indenture  and  the 
notes  issued  hereunder  are  executed  by  the  Promisors  not 
individually,  but  as  trustees  under  the  Agreement  and  Dec- 
laration of  Trust  hereinbefore  mentioned  dated  as  of  April 
26,  1920,  to  which  reference  is  hereby  made,  and  that  any 
and  all  liability  of  the  Promisors  shall  be  expressly  strictly 
limited  to  the  application  and  distribution,  in  accordance 
with  the  provisions  of  said-  Agreement  and  Declaration  of 
Trust,  and  of  this  indenture,  of  the  property  from  time  to 


Release  of 
trust  estate 
upon  deposit 
of  funds  with 
Trustee  for 
payment  or 
redemption  of 
notes. 


Return  of 
funds  not  used 
for  payment  of 
notes  within 
three  years. 


Release  of 
individual 
liability  of 
Promisors, 
executive 
committee,  and 
holders  of  par- 
ticipation 
certificates. 


46 


Rig-hts  of 
action  vested 
in  Trustees. 


time  constituting  the  trust  estate  under  said  Agreement  and 
Declaration  of  Trust,  and  the  trust  estate  under  this  in- 
denture, and  any  and  all  personal  liability  of  the  Promi- 
sors (except  as  aforesaid),  the  executive  committee,  and  the 
shareholders  and  all  beneficiaries  under  said  Agreement  and 
Declaration  of  Trust,  is,  by  the  acceptance  of  said  notes  and 
as  a consideration  for  the  issue  and  execution  thereof  and 
of  this  indenture,  expressly  waived  by  the  holders  of  any 
and  all  notes  issued  hereunder;  it  being  further  understood 
and  agreed  that  the  payment  of  the  principal  of  and  the 
interest  on  said  notes  shall  only  be  sought  for  and  enforcible 
against  and  collectible  out  of  the  property  from  time  to  time 
constituting  the  trust  estate  created  by  said  Agreement  and 
Declaration  of  Trust  and  the  trust  estate  under  this  inden- 
ture. 

ARTICLE  VI. 

RIGHTS  OF  NOTE  HOLDERS. 

Section  1.  No  holder  of  any  note  or  coupon  hereby  se- 
cured shall  have  any  right  to  institute  any  action  or  pro- 
ceeding in  equity  or  at  law  for  foreclosure,  under  the  terms 
of  this  indenture,  or  for  the  execution  of  any  trust  hereof,  or 
for  the  appointment  of  a receiver,  or  for  any  other  remedy 
hereunder,  unless  such  holder  previously  shall  have  given 
to  the  Trustees  written  notice  of  default  hereunder  and  of 
the  continuance  thereof,  as  hereinafter  provided,  or  unless 
also  the  holders  of  not  less  than  twenty-five  per  cent  (25%)  in 
amount  of  the  notes  hereby  secured  and  then  outstanding  shall 
have  made  written  request  upon  the  Trustees  and  shall  have 
afforded  to  them  (or  either  of  them)  a reasonable  oppor- 
tunity either ' to  proceed  to  exercise  the  powers  hereinbe- 
fore granted  or  to  institute  such  action,  suit  or  proceeding 
in  their  own  name,  or  unless  also  they  shall  have  offered 
to  the  Trustees  adequate  security  and  indemnity  against  the 


47 


costs,  expenses  and  liabilities  to  be  incurred  therein  or  there- 
by; and  such  notice,  request  and  offer  of  indemnity  are  hereby 
declared  in  every  case  at  the  option  of  the  Trustees  to  be  con- 
dition precedent  to  the  execution  of  the  powers  and  trusts 
of  this  indenture,  and  to  any  action  or  cause  of  action  for 
foreclosure  or  for  the  appointment  of  a receiver,  or  for  any 
other  remedy  hereunder;  it  being  understood  and  intended 
that  no  one  or  more  holders  of  notes  or  coupons  shall  have 
any  right  in  any  manner  whatever  by  his  or  their  action  to 
affect,  disturb  or  prejudice  the  lien  of  this  indenture,  or  to 
enforce  any  right  hereunder,  except  in  the  manner  herein 
provided,  and  that  all  proceedings  at  law  or  in  equity  shall 
be  instituted,  had  and  maintained  in  the  manner  herein  pro- 
vided and  for  the  equal  benefit  of  all  holders  of  such  out- 
standing notes  and  coupons. 

Section  2.  Any  request,  direction  or  other  instrument  re- 
quired by  this  indenture  to  be  signed  and  executed  by  note 
holders  may  be  in  any  number  of  concurrent  writings  of  simi- 
lar tenor,  and  may  be  signed  or  executed  by  such  note  holders 
in  person  or  by  attorney  appointed  in  writing.  Proof  of 
the  execution  of  any  such  request,  direction  or  other  instru- 
ment, or  of  the  writing  appointing  any  such  attorney,  and 
of  the  ownership  of  unregistered  notes,  if  made  in  the  follow- 
ing manner,  shall  in  the  discretion  of  the  Trustees  (or  either 
of  them)  be  sufficient  for  any  purpose  of  this  indenture,  and 
shall  be  conclusive  in  favor  of  the  Trustees  and  of  the  Promi- 
sors, with  regard  to  any  action  taken  or  not  taken  by  them, 
or  any  of  them,  under  such  instructions,  to  wit : 

(a)  The  fact  and  date  of  the  execution  by  any  per- 
son of  any  such  writing  may  be  proved  by  the  certifi- 
cate of  any  notary  public  or  other  officer  in  any  jurisdic- 
tion who  by  the  laws  thereof  has  power  to  take  acknowl- 
edgments within  said  jurisdiction,  that  the  person 
signing  such  writing  did  acknowledge  before  him  tho 
execution  thereof; 

(b)  The  fact  of  the  holding  by  any  holder  of  notes 
transferable  by  delivery,  and  the  amounts  and  issue 


Proof  of  execu 
tion  of  instru 
ments  by  note 
holders. 


48 


Powers  of  note 
holders  as  to 
releases, 
waivers  and 
modification 
of  trust 
indenture. 


numbers  of  such  notes,  and  the  date  of  his  holding  the 
same,  may  be  proved  by  a certificate  executed  by  any 
trust  company,  bank,  bankers,  or  other  depositary  (wher- 
ever situated),  if  such  certificate  shall  be  deemed  by  the 
Trustee  to  be  satisfactory,  showing  that  at  the  date 
therein  mentioned  such  person  had  on  deposit  with  such 
trust  company,  bank,  bankers,  or  other  depositary,  the 
notes  described  in  such  certificate; 

(c)  The  ownership  of  registered  coupon  notes  shall 
be  proved  by  the  registers  of  said  notes. 

Section  3.  From  time  to  time  the  holders  of  two-thirds  in 
principal  amount  of  all  of  the  notes  hereby  secured  and  at 
the  time  outstanding,  by  their  votes  at  a meeting  of  note 
holders  called  by  the  Trustees,  on  such  notice  as  the  Trustees 
may  deem  sufficient,  or  by  an  instrument  or  instruments  in 
writing  by  such  holders  signed,  shall  have  power,  with  the 
written  approval  of  the  Trustees — 

(a)  To  assent  to  and  authorize  the  release  of  any 
part  of  the  property  mentioned  herein  and  conveyed 
to  or  held  by  the  Trustees  (or  either  of  them)  hereunder, 
under  other  terms  than  those  herein  expressed; 

(b)  To  assent  to  and  authorize  any  modification  or 
compromise  of  the  rights  of  the  note  holders  and  of  the 
Trustees  against  the  Promisors  or  against  the  trust 
estate  or  any  part  thereof,  whether  such  right  shall 
arise  under  this  indenture  or  otherwise;  and 

(c)  To  assent  to  and  authorize  any  modification  of 
the  provisions  of  this  indenture  that  shall  be  proposed 
by  the  Promisors  and  recommended  by  the  Trustees. 

Any  action  taken  with  the  assent  or  authority  given  as 
aforesaid  shall  be  binding  upon  the  holders  of  all  of  the  notes 
issued  hereunder  and  then  outstanding,  and  upon  the  Trus- 
tees, as  fully  as  though  such  action  were  specifically  and 
expressly  authorized  by  the  terms  and  conditions  of  this 
indenture. 


49 


ARTICLE  VII. 

POWERS  OF  THE  PROMISORS, 

Section  1.  From  time  to  time  the  Promisors,  as  Trustees 
under  the  said  Agreement  and  Declaration  of  Trust  dated 
as  of  April  26,  1920,  may  execute  and  file  with  the  Trustee 
a writing  appointing  any  person  or  persons  or.  any  copartner- 
ship or  corporation  the  agent  or  agents  of  the  Promisors 
under  such  designation  as  they  may  determine  and  specify, 
or  any  one  of  the  Promisors,  in  the  name,  place  and  stead  of 
all  of  the  Promisors,  to  sign  any  note  or  coupon  to  he  issued 
under  this  indenture,  or  to  sign  any  order  or  authority  to 
deliver  any  such  note,  when  authenticated,,  or  to  sign  any 
other  order  or  authority  which  the  Promisors  themselves 
might  .sign ; and  thereupon  the  Trustee  shall  he  authorized 
to  authenticate  any  note  or  notes  authorized  to  he  issued 
hereunder,  which  shall  have  been  signed  hy  such  agent  or 
agents  in  the  name  of  the  Promisors,  and  to  deliver  any  such 
note,  when  authenticated,  upon  the  order  in  writing  of  such 
agent  or  agents,  or  to  release  and  surrender  any  or  all  of  the 
securities  pledged  hereunder,  or  to  do  and  perform  any  act 
or  to  take  any  proceedings  which  pursuant  to  the  provisions 
of  this  indenture  the  Trustee  or  Co-Trustee  is  authorized 
to  perform  or  to  take,  upon  the  written  order  of  the  Prom- 
isors. 

Section  2.  From  time  to  time  the  Promisors  may  re- 
voke any  such  appointment  previously  made,  and  may  ap- 
point a substitute  or  substitutes,  with  like  power  and  author- 
ity; but  no  such  revocation  shall  operate  to  annul  or  in  any- 
wise to  affect  any  act  or  proceeding  done  or  taken  by  any 
agent  or  agents  or  one  of  the  Promisors  previous  to  such 
revocation  of  authority  and  service  of  notice  in  writing  there- 
of upon  the  Trustee,  or  shall  operate  to  annul  or  in  anywise 
to  affect  any  act  or  proceeding  done  or  taken  by  the  Trustee 


Authorization 
of  one  of  the 
Promisors  to 
act  for  all  of 
the  Promisors 
and  appoint- 
ment of  agents 
of  the 
Promisors. 


Revocation  of 
appointment  of 
agents,  etc., 
and  substitu- 
tion. 


50 


Effect  of  death 
of  a Promisor. 


Definition  of 
Promisors. 


Successor 
Trustees  under 
trust  agree- 
ment creating 
Associated 
Simmons 
Hardware 
Companies. 


Sufficiency  of 
notice  to 
Promisors. 


or  Co-Trustee  pursuant  to  the  order  of  any  agent  or  agents 
or  one  of  the  Promisors  appointed  as  provided  in  this  Article, 
of  the  revocation  of  whose  authority  notice  in  writing  shall 
not  have  been  given  to  the  Trustee  as  aforesaid. 

Section  3.  The  death  of  the  Promisors  or  any  of  them,  or 
of  any  successors  to  them,  shall  not  operate  to  revoke  any 
agency  or  appointment  created  or  made  pursuant  to  the' 
provisions  of  tlfis  Article. 

Section  4.  For  every  purpose  of  this  indenture,  includ- 
ing the  execution,  issue  and  use  of  any  and  all  notes  hereby 
secured,  the  term  “Promisors”  .includes  and  means  not  only 
the  parties  of  the  first  part  hereto,  hut  also  their  succes- 
sors as  trustees  under  the  said  Agreement  and  Declaration 
of  Trust  dated  as  of  April  26,  1920,  and  the  survivor  or 
survivors  of  them.  Such  successor  and  such  survivor  or 
survivors  shall  possess,  and  from  time  to  time  may  exercise 
each  and  every  right  and  power  hereunder  of  the  Promisors, 
in  the  name  of  the  Promisors,  or  of  the  said  successor,  sur- 
vivor or  survivors. 

Section  5.  Whenever  any  trustee  shall  cease  to  act  as 
such  under  the  said  Agreement  and  Declaration  of  Trust 
dated  as  of  April  26,  1920,  he  shall  without  any  further 
act  cease  to  he  a Promisor  hereunder,  and  the  election  of 
any  successor  trustee  under  said  Agreement  and  Declara- 
tion of  Trust  dated  as  of  April  26,  1920,  shall,  without 
any  further  act,  constitute  such  successor  a Promisor  here- 
under, as  if  herein  specifically  mentioned  as  one  of  the  parties 
of  the  first  part. 

Section  6.  Any  notice  by  this  indenture  authorized  to 
be  given  to  the  Promisors  shall  be  sufficiently  given  for  all 
purposes  hereof  if  addressed  by  mail  to  the  Promisors  at 
their  office  or  agency  last  known  to  the  Trustee,  or  to  such 
office  or  agency  as  the  Promisors  in  writing  shall  designate 
to  the  Trustee. 


51 


Section  7.  Neither  the  Trustee  nor  the  Co-Trustee  shall 
incur  any  liability  whatever  in  respect  to  any  action  or  step 
taken  by  it  in  good  faith  under  the  provisions  of  this  Article. 


ARTICLE  VIII. 

RIGHTS  AND  REMEDIES  IN  EVENT  OF  DEFAULT. 

Section  1.  In  case  any  one  or  more  of  the  following  events 
of  default  shall  occur  (herein  called  events  of  default) — that 
is  to  say: 

(a)  Default  shall  he  made  in  the  due  and  punctual 
payment  of  any  interest  on  any  notes  hereby  secured 
and  outstanding  when  and  as  the  same  become  pay- 
able as  therein  and  herein  expressed  and  any  such  de- 
fault shall  continue  for  a period  of  thirty  (30)  days;  or 

(b)  Default  shall  be  made  in  the  payment  of  the 
principal  of  any  of  the  notes  hereby  secured  when  and 
as  the  same  become  due  and  payable  either  by  the  terms 
thereof  or  by  declaration  of  maturity" or  otherwise;  or, 

(c)  Default  shall  he  made  in  the  due  observance  and 
performance  of  any  other  covenant  or  condition  herein 
required  to  be  kept  or  performed  by  the  Promisors  and 
any  such  last-mentioned  default  shall  continue  for  a 
period  of  thirty  (30)  days  after  written  notice  thereof 
to  the  Promisors  from  the  Trustee;  or, 

(d)  Any  of  the  Controlled  Companies  shall  become 
insolvent  or  bankrupt  or  shall  go  into  liquidation,  either 
voluntarily  (except  with  the  consent  of  the  Trustees)  or 
involuntarily,  or  shall  make  a general  assignment  for  the 
benefit  of  creditors;  or 

(e)  A receiver  of  any  of  the  Controlled  Companies 
or  of  its  properties  shall  have  been  appointed;  or 

(f)  A judgment  or  order  shall  be  entered  for  the 
sequestration  of  any  of  the  property  of  a Controlled 
Company  or  of  the  Promisors,  and  bond  for  release 
thereof  shall  not  be  given  within  sixty  (60)  days  after 
demand  by  the  Trustees  (or  either  of  them),  or  there 
shall  be  any  existing  judgment  against  the  Promisors  or 
a Controlled  Company  unsatisfied  by  appeal  bond  or 
otherwise  for  sixty  (60)  days  after  demand  or  notice 
from  the  Trustees  (or  either  of  them). 


Liability  of 
Trustees. 


Events  of 
default. 


52 


Declaration  of 
maturity  of 
outstanding1 
notes. 


Voting-  of 
pledg-ed  stock 
and  collection 
of  dividends 
thereon  in 
event  of 
default. 


Then  and  in  every  such  case,  the  Trustee  may  in  its  dis- 
cretion, and  upon  the  written  request  of  the  holders  of  not 
less  than  twenty-five  per  cent  (25%)  in  amount  of  the  notes 
then  outstanding  shall,  by  notice  in  writing  delivered  to  the 
Promisors  or  any  one  of  them,  declare  the  principal  of  all 
the  notes  then  outstanding  hereunder  to  be  due  and  payable 
immediately;  and  upon  such  declaration  the  same  shall  be- 
come and  be  immediately  due  and  payable,  anything  in  this 
indenture  or  in  said  notes  to  the  contrary  notwithstanding. 
This  provision,  however,  is  subject  to  the  condition  that  if 
at  any  time  after  the  principal  of  the  notes  shall  so  become 
due  and  payable,  and  prior  to  the  date  of  the  maturity  thereof 
stated  in  the  notes,  and  prior  also  to  the  sale  of  any  of  the 
securities  constituting  the  trust  estate,  all  arrears  of  inter- 
est upon  the  notes,  with  interest  at  the  rate  of  seven  per 
cent  per  annum  on  any  overdue  installment  of  interest  and 
expenses  of  the  Trustees,  shall  be  paid  by  the  Promisors  and 
every  other  default  in  the  observance  or  performance  of  any 
other  covenant  or  condition  of  the  notes  or  of  this  indenture, 
shall  be  made  good  or  be  secured  to  the  satisfaction  of  the 
Trustee,  and  provision  deemed  by  the  Trustee  to  be  ade- 
quate shall  be  made  therefor,  then  in  every  such  case  the 
holders  of  a majority  in  amount  of  the  notes  then  outstand- 
ing, by  written  notice  to  the  Promisors  and  to  the  Trustee 
may  waive  the  default  by  reason  of  which  the  principal  of 
the  notes  shall  have  become  due  and  the  consequences  of  such 
default,  but  no  such  waiver  shall  extend  to  or  affect  any 
subsequent  default,  nor  impair  any  right  consequent  thereon. 

Section  2.  If  any  one  or  more  of  the  events  of  default 
shall  happen,  then  in  every  such  case  the  Trustee  shall  be 
entitled  during  the  continuances  thereof  to  vote  upon  or  con- 
sent or  act  with  respect  to  all  shares  of  stock  then  subject 
to  this  indenture,  and  for  the  benefit  of  the  holders  of  the 
notes  hereby  secured  shall  be  entitled  to  collect  and  receive  all 
dividends  upon  all  such  shares  of  stock  and  sums  payable  for 


53 


principal,  interest  or  otherwise  upon  any  other  securities 
that  shall  then  be  subject  to  this  indenture,  and  to  apply  the 
same  as  provided  in  Section  4 of  Article  VIII  of  this  in- 
denture with  respect  to  the  application  of  the  proceeds  of  a 
sale  of  the  trust  estate;  and  as  holder  of  any  such  shares 
of  stock  and  of  any  other  securities  the  Trustee  shall  be 
entitled  to  perform  any  and  all  acts  and  to  make,  execute 
and  deliver  any  and  all  transfers,  requests,  requisitions,  or 
other  instruments  for  the  purpose  of  carrying  out  the  provi- 
sions of  this  section. 

Section  3.  If  any  one  or  more  of  the  events  of  default 
shall  happen,  then  in  every  such  case  the  Trustee  in  its  dis- 
cretion may,  and  upon  the  written  request  of  the  holders  of 
not  less  than  twenty-five  per  cent  (25%)  in  amount  of  the 
notes  at  the  time  outstanding,  and  upon  being  properly  in- 
demnified as  hereafter  provided,  shall,  proceed  forthwith  to 
sell  and  convert  into  money  singly  or  collectively  all  or  any 
part  of  the  securities,  obligations  or  property  constituting 
the  trust  estate;  such  sale  or  sales  in  the  discretion  of  the 
Trustee  may  be  at  public  auction  at  such  place  and  at  such 
time  and  upon  such  terms  as  the  Trustee  may  fix,  or  may  be 
at  any  regular  brokers’  board  or  stock  exchange  in  the  City 
of  Chicago,  Illinois,  or  in  the  City  of  New  York,  New  York, 
or  in  the  City  of  Boston,  Massachusetts,  or  in  the 
City  of  St.  Louis,  Missouri,  and  at  any  such  sale 
the  whole  or  any  part  of  the  securities  constituting  the  trust 
estate  may  be  sold.  Notice  of  any  sale  at  public  auction 
whether  under  and  by  virtue  of  the  power  of  sale  herein 
contained  or  by  virtue  of  judicial  proceedings,  or  by  any 
judgment  or  decree  in  judicial  proceedings,  or  of  any  judg- 
ment or  decree  of  foreclosure  and  sale  shall  state  the  time 
when  and  the  place  where  the  same  is  to  be  made  and  shall 
contain  a brief  general  description  of  the  property  to  be  sold, 
and  shall  be  published  once  in  each  week  for  four  successive 
weeks  prior  to  such  sale  in  one  or  more  daily  newspapers 


Sale  of  trust 
estate  in  event 
of  default. 


Place  of  sale. 


Notice  of  sale. 


54 


Adjournment 
of  sale. 


Delivery  of 
securities  to 
purchaser. 


Effect  of  sale. 


published  in  the  cities  of  Chicago,  Illinois,  St.  Louis,  Mis- 
souri, Boston,  Massachusetts,  and  New  York,  New 
York,  . respectively.  The  Trustee  may  adjourn  any 
such  .sale  or  cause  the  same  to  be  adjourned  from 
time  to  time  by  announcement  at  the  time  and  place 
appointed  for  such  sale,  or  for  such  adjourned  sale  or  sales; 
and  without  further  notice  or  publication,  such  sale  may  be 
made  at  the  time  and  place  to  which  the  same  shall  be  so 
adjourned.  In  case  of  any  such  sale  of  the  whole  or  any 
part  of  the  trust  estate,  the  principal  of  the  notes  if  not  previ- 
ously due  shall  become  immediately  due  and  payable,  any- 
thing in  said  notes  or  in  this  indenture  contained  to  the  con- 
trary notwithstanding.  Upon  the  completion  of  any  sale  or 
sales  the  Trustee  shall  deliver  to  the  accepted  purchaser  or 
purchasers  the  shares  of  stock  or  other  property  or  securi- 
ties sold,  and  may  execute  sufficient  transfers  thereof,  ana 
the  Trustee  and  its  successors  are  hereby  appointed  the  true 
and  lawful  attorney  or  attorneys,  irrevocably,  of  the  Promis- 
ors, in  their  name  and  stead  to  make  the  necessary  assign- 
ments, transfers  and  conveyances  of  the  shares  of  stock  or 
other  securities  thus  sold,  and  may  substitute  one  or  more 
persons  or  corporations  with  like  power,  the  Promisors  here- 
by ratifying  and  confirming  all  that  their  said  attorneys  or 
said  substitute  or  substitutes  shall  lawfully  do  by  virtue 
hereof.  The  Co-Trustee  shall  also  join  in  and  execute  with 
the  Trustee  any  such  assignments,  transfers  and  convey- 
ances, and  the  Promisors  shall,  if  so  requested  by  the  Trus- 
tee, ratify  and  confirm  such  sale  by  executing  and  delivering 
to  the  Trustee  or  to  such  purchaser  or  purchasers  such  proper* 
transfers  as  may  be  designated  in  such  request. 

Any  sale  or  sales  made  under  or  by  virtue  of  this  indenture, 
whether  under  any  power  of  sale  hereby  granted  and  con- 
ferred, or  under  or  by  virtue  of  judicial  proceedings,  shall 
operate  to  divest  all  right,  title,  interest,  estate,  claim,  and 
demand  whatsoever  either  at  law  or  in  equity,  of  the  Prom- 


55 


isors  of,  in  and  to  all  property  so  sold,  and  shall  be  a per- 
petual bar  both  at  law  and  in  equity  against  the  Promisors, 
their  successors  and  assigns,  and  against  any  and  all  per- 
sons claiming  or  to  claim  the  property  so  sold,  or  any  part 
thereof,  from,  through  or  under  the  Promisors,  their  succes- 
sors or  assigns;  and  no  purchaser  at  any  such  sale  or  sales 
or  his  representatives  or  assigns  shall  be  bound  to  see  to 
the  application  of  the  purchase  money  upon  or  for  any  trust 
or  purpose  of  this  indenture,  or  be  answerable  in  any  man- 
ner whatsoever  for  any  loss,  misapplication  or  nonapplication 
of  any  such  purchase  money  paid  by  him  or  any  part  thereof. 
The  Trustee,  however,  instead  of  exercising  the  power  of 
sale  herein  conferred,  may  in  its  discretion  and  shall,  at  the 
request  in  writing  of  the  holders  of  a majority  in  amount  of 
the  notes  then  outstanding,  proceed  by  suit  or  suits  at  law 
or  in  equity,  as  it  may  be  advised  by  counsel,  to  enforce  the 
payment  of  the  notes,  and  to  foreclose  this  indenture  and 
to  effect  the  sale  of  the  assets  constituting  the  trust  estate 
under  a judgment  or  decree  of  a court  or  courts  of  competent 
jurisdiction. 

Section  4.  In  case  of  any  sale  of  the  trust  estate  or  any 
part  thereof  whether  under  the  power  of  sale  hereby  granted 
or  pursuant  to  judicial  proceedings,  the  purchase  money, 
proceeds  or  avails  together  with  any  other  sums  which  may 
then  be  held  by  the  Trustees  or  be  payable  to  them  under 
any  of  the  provisions  of  this  indenture  as  part  of  trust  es- 
tate shall  be  applied  as  follows: 

First.  To  the  payment  of  the  costs,  expenses,  fees 
and  other  charges  of  such  sale  or  sales  and  the  rea- 
sonable compensation  of  the  Trustees,  their  agents,  at- 
torneys and  counsel,  and  to  the  payment  of  all  expenses 
and  liabilities  and  advances  made  or  incurred  by  the 
Trustees,  and  to  the  payment  of  all  taxes,  assessments 
or  liens  prior  to  the  lien  of  this  indenture,  except  any 
taxes,  assessments  or  other  superior  liens  subject  to 
which  such  sales  shall  have  been  made; 

Second.  Any  surplus  then  remaining,  to  the  payment 


Proceeding-  by 
suit  and 
foreclosure. 


Application  of 
proceeds  of 
sale  of  trust 
estate. 


56 


Application  of 
notes  in  pay- 
ment of  pur- 
chase price  by 
purchaser. 


Trustees  or 
note  holders 
may  become 
purchasers  at 
sale. 


Promisors  to 
pay  amount 
due  in  event  of 
default. 


of  the  whole  amount  owing  and  unpaid  on  the  principal 
and  interest  of  the  notes  with  interest  on  the  principal 
from  date  of  maturity  and  on  the  overdue  installments 
of  interest  at  the  rate  of  seven  per  cent  per  annum,  and 
in  case  such  proceeds  shall  he  insufficient  to  pay  in  full 
the  whole  amount  so  due  and  unpaid  upon  the  notes, 
then  to  the  payment  of  such  principal  and  interest,  rata- 
bly according  to  the  aggregate  of  such  principal  and  un- 
paid interest  without  preference  or  priority  of  principal 
over  interest  or  of  interest  over  principal,  or  of  any  in- 
stallment of  interest  over  any  other  installment  of  in- 
terest, subject,  however,  to  the  provisions  of  paragraph 
(e)  of  Section  1 of  Article  II  of  this  indenture;  and 
Third.  Any  surplus  then  remaining,  to  the  Promisors, 
their  successors  or  assigns,  or  whomsoever  may  be  law- 
fully entitled  to  receive  the  same. 

Section  5.  In  case  of  any  sale  of  the  trust  estate  or  any 
part  thereof,  the  purchaser,  for  the  purpose  of  making  set- 
tlement or  payment  for  the  property  purchased,  shall  be  en- 
titled to  turn  in  or  apply  toward  the  payment  of  the  purchase 
price  and  to  be  credited  with,  any  notes  to  the  extent  of  the 
distributive  share  payable  upon  such  notes,  upon  a distribu- 
tion among  the  note  holders  of  the  net  proceeds  of  such 
sale,  after  making  the  deductions  allowable  under  the  terms 
hereof  for  the  costs  and  expenses  of  sale  and  otherwise,  but 
such  notes  so  applied  in  payment  by  the  purchasers  shall  be 
deemed  to  be  paid  only  to  the  extent  so  applied.  At  any  such 
sale  the  Trustee  or  Co-Trustee  or  any  note  holders  or  their 
agents  may  bid  for  and  purchase  the  property  so  sold,  and 
may  make  payment  therefor  as  aforesaid,  and,  upon  compli- 
ance with  the  terms  of  sale,  may  hold,  retain  or  dispose  of 
said  property,  without  further  accountability;  and  the  re- 
ceipt of  the  Trustee  shall  be  a sufficient  discharge  for  the  pur- 
chase money  to  any  purchaser  of  the  property  or  any  part 
thereof  sold  under  any  of  the  provisions  of  this  indenture. 

Section  6.  In  case  of  the  happening  of  one  or  more  of  the 
events  of  default,  the  Promisors  upon  demand  of  the  Trus- 
tee shall  pay  to  the  Trustee,  for  the  benefit  of  the  holders 


57 


of  the  notes  then  outstanding,  the  whole  amount  then  due 
and  payable  on  all  such  notes  for  principal  and  interest,  or 
both,  as  the  case  may  be,  with  interest  as  aforesaid  upon 
the  overdue  principal  and  installments  of  interest;  and  in 
case  the  Promisors  shall  fail  to  pay  the  same  forthwith  upon 
such  demand,  the  Trustee  in  its  own  name  and  as  trustee 
of  an  express  trust  shall  be  entitled  to  recover  judgment 
for  the  whole  amount  so  due  and  unpaid.  The  Trustee  shall 
be  entitled  to  recover  judgment  as  aforesaid  either  before 
or  after,  or  during  the  pendency  of  any  proceeding  for  the 
enforcement  of  the  lien  of  this  indenture,  upon  the  trust 
estate,  and  the  right  to  recover  such  judgment  shall  not  be 
affected  by  any  sale  hereunder,  or  by  the  exercise  of  any 
other  right,  power  or  remedy  for  the  enforcement  of  the  pro- 
visions of  this  indenture,  or  by  the  foreclosure  of  the  lien 
hereof ; and  in  case  of  a sale  of  the  trust  estate,  or  any  part 
thereof,  and  of  the  application  of  the  proceeds  of  sale  to 
the  payment  of  the  indebtedness  represented  by  the  notes, 
the  Trustee  in  its  own  name,  and  as  the  Trustee  of  an  ex- 
press trust  shall  be  entitled  to  receive  and  to  enforce  pay- 
ment of  any  and  all  deficiency  or  amounts  then  remaining 
due  and  unpaid  upon  any  or  all  of  the  notes  then  outstand- 
ing, for  the  benefit  of  the  holders  thereof,  and  shall  be  en- 
titled to  recover  judgment  for  any  portion  of  said  indebted- 
ness remaining  unpaid,  with  interest.  No  recovery  of  any 
judgment  by  the  Trustee,  and  no  levy  of  any  execution  un- 
der any  such  judgment  upon  property  subject  to  the  lien  of 
this  indenture,  or  upon  any  other  property,  shall  in  any 
manner  or  to  any  extent  affect  or  impair  the  lien  of  the  Trus- 
tee or  Trustees  upon  the  trust  estate,  or  any  part 
thereof,  or  any  right,  powers  or  remedies  of  the 
Trustee  or  Trustees  hereunder,  or  any  right,  powers 
or  remedies  of  the  holders  of  the  notes;  but  such  lien, 
right,  powers  and  remedies  shall  continue  unaffected  and  un- 
impaired as  before.  Any  moneys  thus  collected  by  the  Trus- 


Trustee  may 
recover  judg- 
ment as  trus 
tee  of  an  ex- 
press trust. 


58 


Application  of 
moneys  col- 
lected by 
Trustee. 


Trustee  may 
act  without 
Co-Trustee. 


Waiver  of 
valuation,  stay 
and  redemption 
laws. 


tee  under  this  Section  shall  be  applied  by  the  Trustee,  first , to 
the  payment,  at  the  option  of  the  Trustee,  of  the  costs  and 
expenses  of  the  proceeding  resulting  in  the  collection  of 
such  moneys,  including  the  Trustee’s  own  compensation 
and  expenses  and  liabilities  incurred;  and  second,  toward 
payment  of  the  amount  then  due  and  unpaid  upon  the  notes 
respectively  for  principal  and  interest,  without  any  prefer- 
ence or  priority  of  any  kind,  but  ratably  as  aforesaid,  ac- 
cording to  the  amounts  so  due  and  payable  upon  such  notes 
respectively  at  the  date  fixed  by  the  Trustee  for  the  dis- 
tribution of  such  moneys,  but  subject  to  the  provisions  of 
paragraph  (e)  of  Section  1 of  Article  II  of  this  indenture. 
The  Trustee  may  act  under  this  Section  without  any  joinder 
by  the  Co-Trustee,  and  in  taking  action  hereunder  shall  be 
deemed  to  be  acting  for  and  on  behalf  of  the  holders  of  all 
the  notes  outstanding  hereunder,  and  shall  not  be  required  to 
produce  said  notes  in  any  proceeding  or  action  taken  here- 
under. 

Section  7.  The  Promisors  will  not  at  any  time  insist  upon 
or  plead  or  in  any  manner  whatever  claim  or  take  the  benefit 
or  advantage  of  any  stay  or  extension  law  now  or  at  any 
time  hereafter  in  force,  nor  will  they  claim,  take  or  insist 
upon  any  default  or  advantage  of  any  law  now  or  hereafter 
in  force  providing  for  valuation  or  appraisement  of  the  se- 
curities pledged  hereunder,  prior  to  any  sale  or  sales  there- 
of to  be  made  pursuant  to  any  provisions  herein  contained, 
or  to  the  decree,  judgment  or  order  of  any  court  of  competent 
jurisdiction;  nor  after  any  such  sale  or  sales  will  they  claim 
or  exercise  any  right  under  any  statute  now  in  force  or  here- 
after enacted  by  any  state  or  otherwise,  to  redeem  the  prop- 
erty so  sold  or  any  part  thereof;  and  they  hereby  expressly 
waive  all  benefit  and  advantage  of  any  such  law 
or  laws ; and  they  covenant  that  they  will  not 
hinder,  delay  or  impede  the  execution  of  any  power 
herein  granted  or  delegated  to  the  Trustee  or  Trus- 


59 


tees,  but  that  they  will  suffer  and  permit  the  execution 
of  any  such  power,  as  though  no  such  law  or  laws  had  been 
made  or  enacted;  and  the  Promisors  expressly  waive  any 
requirement  of  any  law  with  respect  to  fhe  jurisdiction  of 
any  court  in  which  any  action  may  be  taken  against  them  for 
the  purpose  of  enforcing  the  provisions  of  said  notes  or  this 
indenture,  and  consent  and  agree  that  such  action  may  be 
taken  in  any  court  where  jurisdiction  over  or  service  upon 
any  one  of  them  may  be  secured  and  waive  all  objections  to 
the  jurisdiction  of  such  court  and  agree  to  enter  such  waiver 
of  jurisdiction  in  any  such  proceeding  and  in  the  absence 
of  the  filing  of  any  such  waiver  agree  and  consent  that 
this  indenture  shall  be  deemed  to  be  such  waiver,  and  also 
consent  and  agree  and  hereby  authorize  the  Trustee  to  desig- 
nate any  attorney,  as  their  true  and  lawful  attorney  to  enter 
and  file  such  waiver. 

Section  8.  No  delay  or  omission  of  the  Trustees  (or  either 
of  them),  or  of  any  note  holder,  to  exercise  any  right  or  power 
accruing  upon  any  event  of  default  shall  impair  any  such  right 
or  power,  or  be  construed  to  be  a waiver  of  any  such  default, 
or  an  acquiescence  therein,  or  extend  to  any  subsequent  de- 
fault; and  every  power  or  remedy  given  by  this  Article  to 
the  Trustee  (or  either  of  them),  or  to  the  holders  of  the 
notes,  may  be  exercised  from  time  to  time,  and  as  often  as 
may  be  deemed  expedient,  by  the  Trustees  (or  either  of  them) 
or  by  the  holders  of  the  notes. 

Section  9.  Except  as  herein  expressly  provided  to  the  con- 
trary, no  remedy  herein  conferred  upon  or  reserved  to  the 
Trustees  (or  either  of  them)  or  to  the  holders  of  notes  issued 
hereunder  is  intended  to  be  exclusive  of  any  other  remedy, 
but  each  and  every  such  remedy  shall  be  cumulative  and 
shall  be  in  addition  to  every  other  remedy  given  hereunder 
or  now  or  hereafter  existing  at  law  or  in  equity  or  by  statute. 


Waiver  of 
jurisdiction 
of  courts. 


Delay,  etc.,  not 
a waiver  of 
defaults. 


Remedies  not 
exclusive  but 
cumulative. 


60 


Restoration  of 
rights  of 
Trustees  in 
event  of  dis- 
continuance of 
proceedings  or 
adverse  rul- 
ings therein. 


Conditions  of 
acceptance  of 
trusts  by 
Trustees. 


Not  responsible 
for 

— recitals  in 
notes  and 
indenture. 


— execution, 
validity  or 
sufficiency  of 
notes  and 
indenture. 


— for  recorda- 
tion, etc. 


Section  10.  In  event  the  Trustees  (or  either  of  them) 
shall  proceed  to  enforce  any  right  under  this  indenture  by 
suit,  or  howsoever,  and  such  proceedings  shall  have  been  dis- 
continued or  shall  have  been  determined  adversely  to  the 
Trustees  (or  either  of  them),  then  and  in  every  such  case  the 
Promisors  and  the  Trustees  shall  be  restored  to  their  former 
positions  and  rights  hereunder  in  respect  to  the  trust  estate, 
and  all  rights,  remedies  and  powers  of  the  Trustees  shall  con- 
tinue as  through  such  proceeding  had  not  been  taken. 


ARTICLE  IX. 

THE  TRUSTEES. 

Section  1,  The  Trustees,  for  themselves  and  their  sev- 
eral successors,  hereby  accept  the  trusts  and  assume  the 
duties  herein  created,  and  imposed  upon  them,  hut  only  upon 
the  following  terms  and  conditions,  to  which  the  Promisors 
and  note  holders  severally  agree: 

(a)  The  recitals  of  fact  and  the  covenants  and  agree- 
ments in  this  indenture  and  in  said  notes  contained  shall 
not  be  construed  as  made  by  the  Trustees  nor  shall  they 
be  accountable  with  respect  thereto. 

(b)  The  Trustees  shall  not  be  accountable  for  the  ex- 
ecution or  validity  hereof  nor  of  the  notes  issued  here- 
under, nor  for  the  sufficiency  of  the  security  provided 
herein,  nor  for  the  genuineness,  validity  or  value  of  any 

‘ securities  which  may  any  time  become  subject  to  this  in- 
denture. 

(c)  The  Trustees  shall  be  under  no  duty  to  file  or 
record  or  cause  to  he  filed  or  recorded  this  or  any  sup- 
plemental or  additional  instruments  as  a mortgage,  con- 
veyance or  transfer  of  property,  or  otherwise,  or  to  re- 
file or  re-record  or  renew  the  same,  or  to  procure  any 
further,  other,  or  additional  instruments  of  further  as- 
surance, or  to  do  any  other  act  which  may  he  suitable  to 
be  done  for  the  better  maintenance  or  continuance  of  the 
lien  or  security  hereof,  or  for  giving  notice  of  the 
existence  of  such  lien,  or  for  extending  or  supplement- 
ing the  same. 


61 


(d)  The  Trustees  shall  be  under  no  responsibility  or 
duty  in  respect  of  the  disposition  of  the  notes  issued 
hereunder  or  the  application  of  the  proceeds  thereof. 

(e)  The  Trustees  may  execute  any  of  the  trusts  or 
powers  hereof  and  perforin  any  duty  hereunder  by  or 
through  attorneys,  agents  or  employees,  and  shall  not 
be  answerable  or  accountable  for  any  act,  default,  neg- 
lect or  misconduct  of  any  such  attorneys,  agents  or  em- 
ployees. 

(f)  The  Trustees  shall  be  under  no  obligation  or 
duty  to  perform  any  act  hereunder  or  to  institute  or  de- 
fend any  suit  in  respect  hereof,  unless  reasonably  indem- 
nified to  their  satisfaction.  The  Trustees  shall  not  be 
required  to  ascertain  or  inquire  as  to  the  performance 
of  any  of  the  covenants  or  agreements  on  the  part  of  the 
Promisors,  and  shall  not  be  required  to  take  notice,  or 
be  deemed  to  have  knowledge,  of  any  default  of  the 
Promisors  hereunder,  and  may  conclusively  assume  that 
there  has  been  no  such  default  until  they  shall  have  been 
specifically  notified  in  writing  of  such  default  by  the 
holders  of  not  less  than  twenty-five  per  cent  in  amount 
of  the  notes  then  outstanding  hereunder.  Except  as 
herein  otherwise  expressly  provided  the  Trustees  shall 
not  be  bound  to  recognize  any  person  as  the  holder  of 
a note  issued  hereunder  unless  and  until  his  note  is  sub- 
mitted to  the  Trustees  for  inspection,  if  required,  and  his 
title  thereto  satisfactorily  established  if  disputed. 

(g)  The  Trustees  shall  be  protected  in  acting  upon 
any  notice,  request,  consent,  certificate,  note  or  other 
paper  or  document  believed  by  them  to  be  genuine  and 
to  have  been  signed  by  the  party  or  parties  purporting 
to  sign  the  same.  The  Trustees  may  advise  with  legal 
counsel,  including  counsel  of  the  Promisors,  and  any  ac- 
tion under  this  indenture  taken  or  suffered  in  /good 
faith  by  the  Trustees  (or  either  of  them),  in  accordance 
with  the  opinion  of  such  counsel,  shall  be  conclusive  on 
the  Promisors  and  on  all  holders  of  the  notes  and  cou- 
pons hereby  secured,  and  the  Trustees  shall  be  fully  pro- 
tected in  respect  thereof. 

(h)  The  Trustees  shall  not  be  liable  for  any  error  of 
judgment  nor  for  any  act  done  or  step  taken  or  omitted 
nor  for  any  mistakes  of  fact  or  law,  nor  for  anything 
which  they  may  do  or  refrain  from  doing  in  good  faith, 
nor  generally  shall  they  have  any  accountability  here- 


-for  applica- 
tion proceeds 
of  notes. 


-for  acts  of 
agrents,  etc. 


-to  institute 
or  defend 
suits. 


-not  bound 
to  take  notice 
of  defaults, 
etc. 


— for  acting- 
upon  docu- 
ments, etc. 


-for  acting-  in 
accordance 
with  opinion 
of  counsel. 


-for  errors, 
etc. 


62 


Trustees  may 
acquire  notes, 
etc. 


Trustees  may 
treat  moneys 
as  general 
deposit. 


Compensation 
of  Trustees 
and  payment  of 
expenses  of 
Trustees. 


Resignation  of 
Trustees. 


under  except  for  their  own  willful  default;  and  neither 
of  the  Trustees  shall  be  liable  or  accountable  for  any 
act  of  the  other. 

(i)  The  Trustees  (or  either  of  them)  may  acquire  or 
hold  notes  and  coupons  issued  hereunder  with  the  same 
rights  which  they  would  have  if  they  were  not  Trustees 
hereunder. 

(j)  Any  money  received  by  the  Trustees  under  any 
provision  of  this  indenture  may  be  treated  by  them 
until  required  to  pay  out  the  same  conformably  here- 
with, as  a general  deposit  without  any  liability  for  in- 
terest. 

(k)  The  Promisors  from  time  to  time  shall  pay  to 
the  Trustees  a reasonable  compensation  for  all  services 
rendered  hereunder,  and  they  shall  also  pay  all  the  rea- 
sonable charges,  counsel  fees  and  other  disbursements  of 
the  Trustees,  and  those  of  their  attorneys,  agents,  and 
employees,  incurred  in  and  about  the  administration  and 
execution  of  the  trusts  hereby  created,  and  the  perform- 
ance of  their  powers  and  duties  hereunder.  In  default 
of  such  payments  by  the  Promisors,  the  Trustees  shall 
have  a lien  therefor  on  the  trust  estate  and  the  proceeds 
thereof  paramount  to  the  lien  of  the  notes  issued  hereun- 
der. The  Trustees  shall  be  reimbursed  by  the  Promisors, 
and  shall  likewise  have  a paramount  lien  on  the  securi- 
ties pledged  hereunder,  and  the  proceeds  thereof,  to  in- 
demnify and  hold  them  harmless,  against  any  liability, 
charge,  assessment  or  expense  they  may  sustain  or  incur 
in  the  premises,  including  debts  contracted  by  them,  and 
against  the  costs  and  expenses  of  defending  against  any 
alleged  liability  in  the  premises  of  any  character  what- 
soever. 

Section  2.  Either  of  the  Trustees  may  resign,  and  be  dis- 
charged from  the  trusts  created  by  this  indenture,  by  giving 
to  the  Promisors  (or  any  one  of  them)  and  to  the  holders  of 
the  notes  notice  by  publication  of  such  resignation,  specifying 
the  date  when  it  is  desired  that  such  resignation  shall  take 
effect,  which  notice  shall  be  published  at  least  once  a week 
for  not  less  than  four  successive  weeks  before  the  date  so 
specified,  in  a daily  newspaper  of  general  circulation  pub- 


63 


lished  in  each  of  the  Cities  of  Chicago,  St.  Louis,  Boston  and 
New  York.  Written  notice  of  such  resignation  shall  he  mailed 
by  the  Trustee  so  resigning  to  the  other  Trustee  and  to  the 
Promisors  or  any  one  of  them,  at  least  twenty-five  (25)  days 
before  it  shall  take  effect.  Such  resignation  shall  take  effect 
on  the  date  specified  in  said  notice,  unless  previously  a suc- 
cessor trustee  to  the  trustee  so  resigning  shall  be  ap- 
pointed, as  hereinafter  provided,  in  which  event  such  resigna- 
tion shall  take  effect  immediately  upon  the  appointment  of 
such  successor  trustee. 

Section  3.  In  case  at  any  time  either  of  the  Trustees  shall 
resign,  or  otherwise  shall  become  incapable  of  acting,  a 
successor  may  be  appointed  by  an  instrument  in  writing, 
signed  by  a majority  in  amount  of  the  holders  of  the  notes  at 
the  time  outstanding.  Until  a new  successor  Trustee  to  the 
Trustee  so  resigning  shall  be  appointed  by  the  holders  of  the 
notes  as  hereinafter  authorized,  the  Promisors,  by  an  instru- 
ment executed  by  a majority  of  them,  may  appoint  a Trustee 
to  fill  such  vacancy.  The  holders  of  more  than  fifty  per  cent 
in  amount  of  the  notes  at  the  time  outstanding  may  by  written 
instrument  executed  by  them  designate  and  appoint  a suc- 
cessor to  any  trustee  which  has  resigned  as  a trustee  hereunder. 
The  successor  to  the  Trustee  herein  named  shall  be 
the  Trustee  hereunder  for  the  purposes  of  this  in- 
denture, and  the  successor  to  the  Co-Trustee  herein 
named  shall  be  the  Co-Trustee  for  the  purposes  of  this  in- 
denture. Every  such  successor  Trustee  or  Co-Trustee, 
whether  appointed  by  such  holders  of  notes  or  by  the  Prom- 
isors, shall  always  be  a trust  company  having  an  office  in 
the  City  of  Chicago,  Illinois,  or  having  an  office  in  the  Bor- 
ough of  Manhattan,  in  the  City  of  New  York,  or  having  an 
office  in  the  City  of  St.  Louis,  Missouri,  and  having  a capital 
and  surplus  aggregating  at  least  Two  Million  Dollars  ($2,000,- 
000).  Any  new  Trustee  or  Co-Trustee  so  appointed  by  the 


Appointment 
of  successor 
Trustees. 


64 


Effect  of 
merger  or 
consolidation 
of  Trustees. 


Rights,  powers 
and  duties  of 
successor 
Trustees. 


Promisors  shall  immediately  and  without  any  further  act  he 
superseded  by  a Trustee  or  Co-Trustee  appointed  in  the  man- 
ner above  provided  by  the  holders  of  the  notes. 

Section  4.  In  the  event  that  either  the  Trustee  or  Co- 
Trustee  at  any  time  merges  or  consolidates  with  any  other 
corporation,  the  corporation  resulting  from  such  merger  or 
consolidation  shall  be  and  become  the  Trustee  or  Co-Trustee 
respectively  hereunder,  without  the  execution  or  filing  of  any 
other  paper  or  instrument,  or  the  doing  of  any  act  on  the 
part  of  any  of  the  parties  hereto,  or  the  holders  of  the  notes 
hereunder,  anything  herein  contained  to  the  contrary  notwith- 
standing. 

Section  5.  Any  successor  Trustee  or  Co-Trustee  appoint- 
ed hereunder  shall  execute,  acknowledge  and  deliver  to  the 
Promisors  an  instrument  accepting  such  appointment  here- 
under, and  thereupon  such  successor,  without  any  further  act, 
deed  or  transfer,  shall  become  vested  with  the  title  to  the  trust 
estate,  and  with  all  the  rights,  powers,  trusts,  duties  and  ob- 
ligations of  its  predecessor  in  trust  hereunder,  with  like  ef- 
fect as  if  originally  named  as  Trustee  or  Co-Trustee  respec- 
tively herein;  and  the  Trustee  or  Co-Trustee  ceasing  to  act 
shall,  on  the  written  request  of  such  successor  assign  or  trans- 
fer the  trust  estate,  or  cause  the  trust  estate  to  be  assigned 
and  transferred  to  such  successor,  and  shall  be  entitled  to  the 
payment  of  its  charges  and  expenses  theretofore  incurred. 
Upon  request  of  such  successor  the  Promisors  shall  execute 
and  deliver  such  instrument  of  assignment,  and  further  as- 
surances as  may  reasonably  be  required  for  more  fully 
and  certainly  vesting  in  and  confirming  to  such  successor  Trus- 
tee or  Co-Trustee  all  rights,  title  and  interest  of  the  pred- 
ecessor Trustee  or  Co-Trustee  in  and  to  the  trust  estate. 
All  conveyances  and  instruments  herein  provided  for  shall  be 
at  the  cost  and  expense  of  the  Promisors. 


65 


Section  6.  First  National  Bank  in  St.  Louis  has  been 
joined  as  Co-Trustee  hereunder,  so  that  if,  by  reason  of  any 
present  or  future  laws  in  any  jurisdiction  in  which  it  may 
be  necessary  to  perform  any  act  hereunder,  the  Continental 
and  Commercial  Trust  and  Savings  Bank,  the  Trustee  here- 
under, or  its  successor,  may  be  incompetent,  or  disqualified, 
or  unwilling  to  act  as  sole  Trustee  hereunder,  then  all  of  the 
acts  required  herein  to  be  performed  in  such  jurisdiction 
shall  and  may  be  performed  by  the  said  Co-Trustee,  or  its 
successor,  acting  with  said  Trustee  jointly,  or  severally.  Ex- 
cept as  may  be  deemed  necessary  for  the  Co-Trustee  or  its 
successor  to  execute  the  trusts  hereof  jointly  with 
the  Trustee  or  separately,  the  Continental  and  Commercial 
Trust  and  Savings  Bank,  as  Trustee  hereunder,  or  its  suc- 
cessor, may  solely  have  and  exercise  the  powers,  and  shall 
be  solely  charged  with  the  performance  of  the  duties  herein 
declared  incumbent  upon  the  Trustees.  Any  request  in  writ- 
ing made  by  the  Continental  and  Commercial  Trust  and  Sav- 
ings Bank,  as  Trustee  hereunder,  or  its  successor  to  the  First 
National  Bank  in  St.  Louis,  as  Co-Trustee  hereunder,  or  its 
successor,  shall  be  sufficient  warrant  for  such  Co-Trustee,  or 
its  successor  to  take  the  action  requested.  The  Co-Trustee 
may  delegate  to  the  Trustee  the  exercise  of  any  power,  dis- 
cretionary or  otherwise  conferred  upon  the  Co-Trustee  by 
this  indenture. 

/ 

Section  7.  Whenever  used  in  this  indenture,  the  term 
“Trustee”  means  the  Trustee  for  the  time  being  under  this 
indenture,  whether  original  or  successor,  and  the  term  “Co- 
Trustee”  means  the  Co-Trustee  for  the  time  being  under  this 
indenture,  whether  original  or  successor. 

Section  8.  In  any  proceeding  brought  by  the  Trustees  (or 
either  of  them)  hereunder  the  Trustees  (or  either  of  them) 
shall  be  held  to  represent  all  of  the  holders  of  the  notes  then 


Powers  and 
duties  of 
Co-Trustee. 


“Trustee.” 


“Co-Trustee.” 


Trustees 
represent 
holders  of 
notes. 


66 


Effect  of  ille- 
gality of  any 
provision  of 
notes  or  inden- 
ture. 


Indenture 
binding  on  suc- 
cessors of 
Promisors. 


Execution  of 
indenture  in 
counterparts. 


Testimonium. 


outstanding,  and  it  shall  not  be  necessary  to  make  such  note 
holders  parties  to  any  such  proceeding. 


ARTICLE  X. 

INTERPRETATION  AND  SUNDRY  PROVISIONS. 

Section  1.  In  event  that  any  one  or  more  of  the  provisions 
of  this  indenture,  or  of  the  notes  or  coupons  secured  hereby 
shall  for  any  reason  be  held  to  be  illegal  or  invalid,  such  ille- 
gality or  invalidity  shall  not  affect  any  other  provision  of 
this  indenture  or  of  said  notes  and  coupons,  but  this  indenture 
and  said  notes  and  coupons  shall  be  construed  and  enforced 
as  if  such  illegal  or  invalid  provision  or  provisions  had  never 
been  contained  therein. 

Section  2.  All  the  covenants,  stipulations,  promises  and 
agreements  in  this  indenture  contained  by  or  on  behalf  of  the 
Promisors*  shall  bind  their  successors  and  assigns  whether  so 
expressed  or  not. 

Section  3.  This  indenture  is  executed  in  five  counterparts, 
each  of  which  so  executed  shall  be  deemed  to  be  an  original, 
and  such  counterparts  shall  together  constitute  but  one  and 
the  same  instrument. 

In  witness  whereof,  Wallace  D.  Simmons,  Levi  L.  Rue  and 
Edward  H.  Simmons  as  the  present  acting  and  qualified  trus- 
tees under  said  Agreement  and  Declaration  of  Trust,  dated 
as  of  April  26,  1920,  and  as  parties  hereto  of  the  first  part, 
have  hereunto  affixed  their  names  and  seals  and  said  Con- 
tinental and  Commercial  Trust  and  Savings  Bank  and  said 
First  National  Bank  in  St.  Louis,  parties  of  the  second  part 
to  evidence  their  acceptance  of  the  trusts  hereby  created,  have 
caused  this  indenture  to  be  signed  by  their  respective  corpo- 
rate officers  thereunto  duly  authorized  and  their  respective 


67 


corporate  seals  to  be  hereunto  affixed  as  of  the  day  and  year 
first  above  written. 

Wallace  D.  Simmons  (seal) 
Levi  L.  Rue  (seal) 

Edward  H.  Simmons  (seal) 
As  Trustees  under  the  Agreement  and  Dec- 
laration of  Trust  dated  as  of  April  26, 
1920,  creating  the  trust  therein  called  the 
Associated  Simmons  Hardware  Companies, 
and  not  individually. 

Continental  and  Commercial  Trust  and  Savings  Bank, 

By  Louis  B.  Clarke, 

(corporate  seal)  Vice  President. 

Attest : 

W.  P.  Kopf, 

Secretary. 


First  National  Bank  in  St.  Louis, 

By  W.  W.  Smith, 

(corporate  seal)  Vice  President. 

Attest : 

L.  Allen, 

Cashier . 


Promisors. 


Trustee. 


Co-Trustee. 


68 


Acknowledg- 
ment of 
Wallace  D. 
Simmons. 


Commonwealth  of  Massachusetts 
County  of  Suffolk 


On  this  first  day  of  May,  1920,  before  me  person- 
ally appeared  Wallace  D.  Simmons,  to  me  known  to  be 
the  person  described  in  and  who  executed  the  foregoing  instru- 
ment and  acknowledged  that  he  executed  the  same  as  his  free 
act  and  deed. 

In  witness  whereof,  I have  hereunto  set  my  hand  and 
affixed  my  official  seal  this  first  day  of  May,  1920. 

My  commission  expires  Dec.  20,  1923. 

Charles  0.  Pengra, 

( notarial  seal)  Notary  Public  in  and  for  the  County 

and  State  Aforesaid. 


69 


Commonwealth  oe  Massachusetts 
County  oe  Suffolk 


On  this  first  day  of  May,  1920,  before  me  personally  ap- 
peared Edward  H.  Simmons,  to  me  known  to  be  the  person  de- 
scribed in  and  who  executed  the  foregoing  instrument  and  ac- 
knowledged that  he  executed  the  same  as  his  free  act  and 
deed. 

In  witness  whereof,  I have  hereunto  set  my  hand  and 
affixed  my  official  seal  this  first  day  of  May,  1920. 

My  commission  expires  Dec.  20,  1923. 

Charles  0.  Pengra, 

(notarial  seal)  Notary  Public  in  and  for  the  County 

and  State  Aforesaid. 


Acknowledg- 
ment of 
Edward  H. 
Simmons. 


70 


Acknowledg- 
ment of 
Iievi  !■.  Rue. 


Commonwealth  of  Massachusetts 
County  of  Suffolk 


On  this  first  day  of  May,  1920,  before  me  per- 
sonally appeared  Levi  L.  Rue,  to  me  known  to  be  the  person 
described  in  and  who  executed  the  foregoing  instrument  and 
acknowledged  that  he  executed  the  same  as  his  free  act  and 
deed. 

In  witness  whereof,  I have  hereunto  set  my  hand  and 
affixed  by  official  seal  this  first  day ‘of  May,  1920. 

My  commission  expires  Dec.  20,  1923. 

Charles  0.  Pengra, 

(notarial  seal)  Notary  Public  in  and  for  the  County 

and  State  Aforesaid. 


71 


State  of  Illinois  / 
County  of  Cook  ) 


Acknowledgf- 
ment  of  Trus- 
tee. 


On  this  7th  day  of  May,  1920,  before  me  appeared  Louis 
B.  Clarke  to  me  known,  who  being  by  me  duly  sworn,  did  say 
that  he  is  the  Vice  President  of  Continental  and  Commercial 
Trust  and  Savings  Bank,  one  of  the  corporations  which  exe- 
cuted the  above  and  foregoing  indenture,  and  that  the  seal  at- 
tached to  said  instrument  is  the  corporate  seal  of  said  corpo- 
ration and  that  instrument  was  signed  and  sealed  on  behalf 
of  said  corporation  by  authority  of  its  Board  of  Directors, 
and  said  Louis  B.  Clarke  acknowledged  said  instrument  to 
be  the  free  act  and  deed  of  said  corporation. 

In  witness  whereof,  I have  hereunto  set  my  hand  and 
affixed  my  official  seal  this  7th  day  of  May,  1920. 

My  commission  expires  Nov.  30,  1921. 

E.  H.  Gundaker, 

(notarial  seal)  Notary  Public  in  and  for  the  County 

and  State  Aforesaid. 


72 


Acknowledg- 
ment of  Co- 
Trustee. 


State  of  Missouri  ( 

City  of  St.  Louis  j ss* 

On  this  8th  day  of  May,  1920,  before  me  appeared  W.  AY. 
Smith  to  me  known,  who  being  by  me  duly  sworn,  did  say  that 
he  is  the  Vice  President  of  First  National  Bank  in  St.  Louis, 
one  of  the  corporations  which  executed  the  above  and  fore- 
going indenture,  and  that  the  seal  attached  to  said  instru- 
ment is  the  corporate  seal  of  said  corporation,  and  that  said 
instrument  was  signed  and  sealed  on  behalf  of  said  corpora- 
tion by  authority  of  its  Board  of  Directors,  and  said  AY.  AY. 
Smith  acknowledged  said  instrument  to  be  the  free  act  and 
deed  of  said  corporation. 

In  witness  whereof,  I have  hereunto  set  my  hand  and 
affixed  my  official  seal  this  8th  day  of  May,  1920. 

My  commission  expires  February  6th,  1923. 

A.  F.  Brannigan, 

(notarial  seal)  Notary  Public  in  and  for  the  City  and 

State  Aforesaid. 

[$3,750  U.  S.  Internal  Revenue  Stamps  affixed  to  original 
executed  indenture  and  canceled.] 


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